Welcome to the forum. Didn't the esab come with a book of instructions? That would be the most accurate guide to the functions. But I'll have a go...
For spot welding the knob acts as a timer to run the welder for a few seconds. It's intended for MIG spot welding where you clamp two bits of metal together very tightly one behind the other, then hold the torch still and weld on one piece and hope it penetrates through and welds to the other. I prefer plug welding (similar but you drill a hole in the top piece and weld to the bottom one before attaching it to the top one giging more certainty of a join).
The welders with the knob often have another position with markings like a square wave. I understand that's for stitch welding where the welder is on for a second then off for a second (and so on) as you travel down a joint. It's a very useful feature for welding thin steel while limiting the heat and preventing hole blowing.