Complimentary N - P mosfet circuit does not fully turn off
What you are describing sounds like what I would expect from that circuit.

If you ground the gates, then M2 will pull down until the output is equal to the threshold voltage, which appears to be 1.5-1.6 V. 

If you want 0 V on the output when the input is low, then you have to either pull the gates a couple of volts further down (according to the datasheet, you have 1 V left before the absolute maximum). Or place the N-MOS at the bottom and P-MOS at the top, which is how complementary half-bridges are usually made. 

If you are going to make a typical half-bridge, then you should take some precautions. Here's one kind of half-bridge that adds some delay to the gate so when the gate goes from high to low, or low to high, then the correct MOS will turn off before activating the other one. Without the diodes in the link, you will activate both when the gate is at half of VDD => enormous current flowing => magic smoke.