Hm,I think I know what's going on.
C2 is reading every frame that the Up and Left (for example) are being pressed, so it's setting the animation every frame!
Up key is down
-> Left key is pressed: Set animation to up-left
-> Right key is pressed: Set animation to up-right
-> Else: Set animation to up
If it doesn't work, I may have another solution, but it's more complex... I hope this one works =P