I am using the WGS 84/UTM coordinate sysytem.
When I go to > Project Properties / General / Canvas Units to Degrees, Minutes, Seconds my coordinates are wrong.
I am using QGIS 2.0.1
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UTM always has metres as units.
If you want degrees, change the project CRS to EPSG:4326 (WGS84) first. Then you can switch from decimal degrees to degrees-minutes-seconds as you did.