Are you using a tapped oil pan or a banjo bolt style return line?
Rotating a turbo will not damage it. I rotated mine and it works awesome so I don't how you could have damaged yours unless you did something terribly wrong. Yes, the big port should be facing down, as nearly all turbos are gravity powered for oil return, so you have the right location.
If you are using the banjo bolt return, make sure that you have the return line steep enough, as to much of a horizontol return will cause oil buildup in the line, resulting in large amounts of smoke from the exhaust.
Another thought, do you have an oil catch can? This might be what you need, though if it happened on the first drivie it sounds like a bad turbo seal or bad return line setup.