Fred,
Your understanding of how that circuit works is exactly the way I see it. Yes it is a 3 position switch and functions as you described it. You are also correct when you say "it is always possible that you have more than one fault", because as it turns out... that is the case. I found at least 2 problems in the circuit.
First, I did a little research and found out how to test the relay... turns out the relay was defective, so I swapped it out with another that tested good. Now if I hold down the float button I have float, but it does not stick when I release the button and the light on the switch does not illuminate. So I at least know the solenoid is working.
Next, I traced the wires down to the float circuit where I located the pressure switch. I jumped the switch so we know for sure it is closed. I momentarily depress the float switch and release it... "Voila"... we have sustained float!! I pull back on the joystick to raise the loader arms and nothing happens... just as we would expect at this point as the pressure switch is closed and disconnected so pulling back on the joystick cannot trigger the switch to disengage the float. However, I still have no light on the float switch at this point.
So I remove the jumper wire from the pressure switch and put everything back together. I decide to test the circuit one more time before I call it a night. I know the float function is not going to stick because the pressure switch is bad but it should still float if I hold the float switch down. So I raise the loader arms and hold down on the float switch... the loader slowly falls to the ground and the float switch lights up this time!!??
The conclusions drawn from this are:
1. The float circuit is functional
2. The pressure switch is defective (and must be replaced)
3. I still may have a faulty float switch given that at one point I had power to ALL terminals and that the light on the switch works intermittently.
Does anything come to mind that would cause ALL the switch terminals to have power, besides a faulty switch?
If I replace the pressure switch and have any further problems my next best guess would be to replace the float switch (or dissect it).
I think I figured out how that float switch functions. On the "+" side, the switch between terminals 1 and 3 are "normally open", on the "-" side, the switch between terminals 2 and 6 are "normally closed".
When you press the switch to on, it joins terminals 1 and 3, effectively completing the circuit. When you release the switch the loop created by the pressure switch holds the relay closed.
When you press the switch to the "off" position, it disconnects terminals 2 and 6, effectively interrupting the circuit and the relay opens, bringing us back to the "off" position.
Thanks "very much" to all who helped me with this.