I've got a couple thoughts... Check the sole of the walking foot and make sure it's seated in the side arms, and that the screw on the side is tightened all the way. I've seen them act badly when it's loose.
When you say the the "top thread," do you mean the top of the fabric? If it's the top of the fabric, you need to tighten the bobbin case tension.
Does it sew OK with a regular foot? If the fabric is "lifting up under the foot," I wonder if the feed dog timing is not in sinc with the needle timing? When the needle is coming down, and just about to go into the needle plate, the feed dogs should be just below the needle plate and moving down. If that's off, you'll need to take it to the shop.