Okay after all this conversation, I again tried Magic Loop with Portuguese style knitting and it worked perfectly!
I have no idea what I was doing last time. I guess sometimes you just need to put it down and take a break, then try again.
Before when I tried to pull that first stitch tight, it pulled tight all the way to my neck! And then I couldn't see what I was doing.
Anyway it simply works like normal if you just do it right.
I thank you all for your input and suggestions, I actually learned a lot.
Now back to my tubular scarf!