Yes, HH is for heading hold.
As for 120%, that depends on setup and model. I usually set it manually checking that the linkages don't bind up at both extremes of rudder throw. I DON"T do this in radio programming since it has a different affect.
If that doesn't work, bump your gain up until the machine starts to wag, and then back off. I setup a TOW cobra last weekend and the gain was about 95% on a 401 with no wagging.
Also, check that your battery is not dropping low, do a full discharge/charge on your RX batt with a good charger that can tell you millamp/hours in and out. Make sure it takes a full charge and then test the battery with a load testor. I have gyros that have the "feature" of telling you when the battery is too low by giving out during hovering. Even if you think the battery is good, verify with a really good charger, this is the single most overlooked troubleshooting step and is about 75% of the time the real culprit for people that are seeking my help.
If that is still not the issue, test the tail blade bearings for wear. Turn the heli off and pop the ball link off of the rudder control arm, grab each tail blade one in each hand, and apply pressure away (pull them away from each other to simulate load while spinning), and then twist them in the motion of actuation (where they would change pitch). If anything, I mean ANYTHING feels crunchy, tear down the tail and start replacing bearings.
If that isn't the issue, check that your torque tube is not disconnecting or sliding
Check that your control rods are not sliding in and out of the ball links (stripped ball links)
Check that your tail counter gear is not missing teeth and is meshing properly.
Check that you haven't lost any drive pins in the gearing for the tail
Check screws going through ball links
Check to make sure servo is not moving and that arm is not slipping.
Check servo for stripped gears
If I think of anything else I'll add to the list