I think I have found the reason.
I went through your process and have attempted to think as you might have.
{
All right we've got 1.2 kg of air, traveling at 10m/s.
Since the wall is 1 square meter in area this means that our volume of air has dimensions 1x1x1.
So if the cube is 1 meter in depth, it will take 0.1 seconds for the last particles to reach the wall. (am I inline with your thinking so far?)
So then,
\frac{1.2kg*10\frac{m}{s}}{0.1s*1m^2}=120\frac{N}{m^2}
}
I believe the problem you face has to do with essentially creating a solid. I think the root of your math is saying that the air is not a fluid but actually constrained like a solid and that the wall has to impart the change of momentum across the whole solid, during the entire tenth of a second.
During that last segment of time your math is still assuming the entire mass of the air, when in reality, at anyone point in time the wall really only has to stop the mass that is found in the control volume Area\cdot du
The best example I can give is a video. It's kind of imperfect but it's kind of a good mental model.
http://www.youtube.com/watch?v=oxbFrGFNVO0&feature=related
Does this help?