Based on your gauge reading, that is either system pressure OR your tag axle pressure is way too high, but I think it is system pressure. Thinking about it, a system pressure gauge there would help the service techs confirm that the system was aired up when working on the coach and using shop air.
You are correct that activating the switch only causes a temporary change in the tag axle pressure and it will go back to it's preset level when the switch to in the normal position. It would not make sense that moving the switch either direction would 'permanently' change the tag axle pressure.
Yes, I get a warning chime when I dump the tag axle to remind me to switch it back to normal before I start to accelerate. At speeds under 10 mph, the tires on the drive axle will handle the extra weight of the tag being dumped but not at normal driving speeds. However, if it is a momentary contact switch, that would not be necessary since it would start returning to normal as soon as you released it.
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