This may be completly wrong but did you maybe fill the resevior to much? That
might make too much pressure in the system.
Something definatly doesn't sound right if it's grabbing that hard that quickly.
Check to see if the wheel spins freely off the ground without the brakes applied. The pads might already be in a braking position. This, in addition to what you have happening, could make too much heat and warp the rotors.
My co-worker once had trouble with his bike. He felt like he lost a ton of power all of a sudden. I took it for a ride and found out the hard way what was wrong. The front brakes were already breaking without them being applied(drag on breaks felt like loss of power) and when I took a corner over some MINOR gravel the front breaks locked up. I somehow managed to keep it up but it wasn't fun, hurt my leg. When I got back and stopped(without using the front break) the front rotor was so hot that it burned my hand and gave me a scar.
I'm not sure how he fixed it but I would definatly check this out.