You're all too far in front and skipping several important steps as a result.
1.) It could be "stuck" in 'reset' because of the kind of transformer being used. Before getting fancy with anything new please try an old-fashioned one, i.e. one with no electronics in it. The voltage on the output of the transformer must go down to zero when you position the throttle at fully closed.
2.) It could be stuck in 'reset' because you're not applying your power with the specific sequence required by PS-1's, which is:. Apply full power. Wait for battery to charge (hours if you haven't used it in six months or more), or BCR, if installed instead, to charge (5 minutes max). Bring the throttle down to half then hit the direction button. It should start moving. Be aware that there is apparently a different approach for the very earliest PS-1's, involving the opposite motions with the throttle.
3.) It could be stuck in 'neutral' because it's been previously locked in neutral. Your attempt to do a 'factory reset' should have cleared this if this was the problem.
4.) If after all this, you get 3 clanks every time you power it up then you can assume that it might be scrambled.
Follow this link for more detail, embedded within a previous poster's related question on Protosound 1:
Rock island set MT-2127LP | Merlin
This one has very specific detail on the process that works for me:
Protosounds stuff using a TPC-300, 6-14189, powered by a PH-180, and controlled by a CAB-2 | Mellow Hudson Mike
This link cites the alternative approach, which for whatever reason is quite different, that was published back in the day, apparently by MTH. It does not work on my Proto 1's, which are all later vintage:
PS1 Cautionary Note | mort1345
Good luck, and let us know how things turn out.
Mike