I've always had trouble making red MMF. I made a batch day before yesterday (waited to see if it would turn weird before sharing ) and I think I've figured it out. This is what I used:

1 lb generic marshmallows
2 lbs domino powdered sugar
1/2 tsp lorann flavoring
1/3 cup water
Americolor super red to desired shade
Crisco for greasing bowl and hook (or hands and counter)

I added the red color to the marshmallows before adding the sugar, but I'd done that in the past and it still ended up crumbly. All the numbers have worn off of my measuring cups and I thought I was adding 1/4 cup water. When I noticed how well the finished fondant was behaving, I looked again and realized I had added 1/3 cup water instead. I can't believe it made such a difference, but thought I'd share since I know I'm not the only one who has issues with red MMF.

great tip! thanks for sharing.