It's quite simple.
There is a Feedback potentiometer. The added switch just shorts (or opens, have to check the schematic) the pot, so maximum regeneration is fed back to the delay chip. If you look at the schematic you can figure it out youtself. It doesn't matter what version of the DD3 you're looking at, the circuit on all of them is all the same (with the exception of the Delay chip, but you will not be messing with it).