I think you're backwards on this. It's not a beginner's radio to program. I highly suggest reading through the help documentation.
A scan list has a maximum of 32 members, so there's no way you added 127 personalities to one scan list.
When you're in a personality, you assign that personality to USE a specific scan list. It will look to that scan list and use the settings you provided in that list to determine how to scan. If you only want the radio to scan the zone you are currently in, make Scan List 1 a Conventional (Single Zone) scan list. When you select a channel, it will then load those parameters. So you can set every personality in every zone to Single Zone, and the radio will only look to members of the currently selected zone that are enabled (via Scan Add in the Zone/Ch Parameters page).
Multi-Zone will allow the radio to look at all enabled (via Zone Add in Zone/Ch Parameters) zones in addition to the existing zone.
Uncheck Revert Channel Display in the scan list to determine if the radio is indeed scanning. When you say that you see the icon, which icon are you seeing? There are three Scan-related icons. Are you hearing different tones (Lo-Hi and Hi-Lo) when you turn scan on and off?