An alternate, and probably alot simpler, method can be found here:
http://www.engine001.com/tutorials/Objective+Compass_31.htm
I recomend that you view both of these tutorials before starting.
Definition: a compas that points in the direction that the player needs to travel. Aka: a quest com pas, objective compas. It is not a north south east west thing.
make a new graph in the hud, make it a rotating dial and call it compass. Set its maxiumum value to 360
Make a new variable called "compass angle" ( see http://www.engine001.com/tutorials/HUD+and+Interface+Guide_5.htm) and set the rotating dials "Retrive value" to that variable
On the first map you want the compass to operate on, make a new invisible character called "compass", and position him where you want the compass needle to point too (eg position him at the start of end of the first objective on that map). Set his movement style to face main character.
(NOTE: this character must have diagonal sprites, if you don't have a character that does then make a new character and draw something in all 8 boxes. it doesn't matter what you draw because no one will see the character anyway.)
Next, place a timer in the map. set its number of ticks to 0 and time between ticks to 300
under the 'every tick' script, make a comparison branch that checks if the character 'compass facing direction is down.
if it is then that must mean that the player needs to walk up to reach the destination, because the character 'compass' is positioned there.
For the arrow to point DOWN set the variable to 1
For the arrow to point UP set the variable to 180
For the arrow to point RIGHT set the variable to 90
For the arrow to point LEFT set the variable to 270
Done!, now repeat for every map that you want to have a compass in.
