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Edit:- I think I'm going to start again and approach this from a different angle, also this thread is kind of dumb, ie the name. (my fault) so I'm going to leave this and create a new one should ..ahem.. when, I run into problems. ;)
I can't seem to delete or lock it though, so I'll just leave it and let it vanish.
If you're using a custom movement, collision detection with walls is a little bit trickier then that. The "Move Safely 2 Object", as I think it was called (to be on the safe side, when using the extension manager to search for it, just search for "move safely", that should make it show up), however, can make the process a LOT easier. If and when you install it, and after looking at the examples and/or the documentation, you'll probably see why.
If you look through those examples and the documentation and still don't quite understand how it works, I might be able to put together an example for you. :)