The "Gain" pot on the Dist+ provides more gain the smaller its resistance is. The resistance in question is that between the wiper and one OR the other outside lug.
Why does the schematic show 3 lugs being used? Simple. It is traditionally considered a good practice to insure against the potential for noise produced via intermittent contact by placing a wire between the wiper and the other outside lug. Obviously, the wire connection between wiper and outside lug contributes no resistance. However, should the wiper momentarily go out of contact with the resistive strip inside the pot, the maximum resistance will never be more than the value of the pot.
This practice is not absolutely mandatory. If you see a PCB layout with three holes for a pot, and two of them are in contact with each other, you have the choice of running three wires to the pot...OR two. Three is safer, but two is easier.