COMP-3 (or "packed decimal") data looks like this: 0x12345s, where "s" is C for positive, D for negative, or F for unsigned. Thus 0x12345c -> "12345", x012345d -> "-12345", and 0x12345f -> "12345".
You've got one obvious error: You're ignoring the nybble in the byte that contains the sign nybble (e.g., "5" above) if the sign is negative. In addition, you're working too hard at manipulating the nybbles, it's a simple bitwise-and or a 4-bit shift to isolate a nybble.
Try something like this (untested):
public String unpackData(String packedData, int decimalPointLocation) {
String unpackedData = "";
char[] characters = packedData.toCharArray();
final int negativeSign = 13;
for (int currentCharIndex = 0; currentCharIndex < characters.length; currentCharIndex++) {
byte firstDigit = ((byte) characters[currentCharIndex]) >>> 4);
byte secondDigit = ((byte) characters[currentCharIndex]) & 0x0F;
unpackedData += String.valueOf(firstDigit);
if (currentCharIndex == (characters.length - 1)) {
if (secondDigit == negativeSign) {
unpackedData = "-" + unpackedData;
}
} else {
unpackedData += String.valueOf(secondDigit);
}
}
if (decimalPointLocation > 0) {
unpackedData = unpackedData.substring(0, (decimalPointLocation - 1)) +
"." +
unpackedData.substring(decimalPointLocation);
}
return unpackedData;
}