Is this the stitch regulator for a Grace frame? I think it's altogether possible that the seller decided she preferred to sew in non-stitch-regulated mode and therefore wants to sell a perfectly good stitch regulator for which she has no use. Have you asked whether she is able to show you how it works (and therefore demonstrate that it does indeed work)? If so, take DH or a friend (I agree with that safety precaution!) and go try it out.
This blog has a good description of how it should work -
http://www.graceframe.com/site/sally...ch-regulator-1