I had an '04 American Tradition with the same switch and it works as you describe. It isn't really a "dump" switch - the suspension auto-dumps when you deploy the jacks. Instead, that switch is intended for very short time adjustments to the ride height, e.g. to enter a low garage door, get under a low bridge, etc. The adjustment lasts only as long as you hold the switch because driving with the ride height high or low is damaging to the drive line. The driveshaft angle from transmission to rear axle will be incorrect, causing excessive wear if driven that way very long.
Former owner of 2004 American Tradition and several other RVs
Home is in the Ocala Nat'l Forest near Ocala, FL
Summers in Black Mountain, NC