I doubt its the state machine as it just handles the animations and the transitions between them and the blend space for the idle/walk cycle should not change the characters forward vector (assuming you still use the provided state machine that comes with the template).
Just to make sure i get this right: The character does a 180, when you first move forward (pressing W) and then back (pressing S)? Does this happen too when you leave the mouse alone? Can you perhaps share a character BP screenshot?
Cheers,
Michael