The button is used to remove the sight from its base. You press it in and hold it, while pulling upward on the moveable "L" shaped part which includes the adjustment knobs and aperture.

If the sight has not been removed in some time, it probably needs a good dousing in penetrating oil to loosen it up.

The button releases the threaded portion of the elevating stem from the base. The same result can be obtained by simply turning the elevation knob until it reaches the end of the threaded portion. The button merely allows the upper part of the sight to be removed and replaced without turning the elevation knob. If you note the position of the sight on the elevation scale, the sight can then be returned to its original setting.

I wouldn't discard the sight out of hand. Once you get used to it, you may find that you can shoot groups nearly as tight with it as you can with a scope. (You can dispense with the screw in aperture for hunting purposes).

How much did you have to pay for this diamond in the rough, if you don't mind telling?