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I recently got a very old agfa silette camera, and there is this dial with the "R" that is used to rewind the film. In addition to that, is has a little window showing something below - What is that for?

I am not even sure how this thing rotates. When I rotate the rewind dial, the inside only rotates very slowly and mostly at random. I was able to get it to some different positions but it takes me like 3-4 full turns depending on the force I use to advance to the next position of that plate. It has some degree numbers on it but also just some letters.

What is that for and how is that being used, given that it only turns at what seems to be random?

This is just a passive dial (that does not communicating anything to the camera mechanism), meant as a memorizing aid for the film type and speed inserted.

The degree values are DIN speed numbers.

C seems to be a shorthand for generic "Color" film.

CT, CN17 and K appear to be shorthands for various Agfa film stocks that were contemporary for that camera:

"CT" ("Color Transparency") is found in the name of various color slide films, eg "Chrome CT 18", though the latter was apparently only introduced 1958, so the intent could have been generic "Color Transparency"

"Agfacolor CN17" was a 17 DIN/40 ISO "Color Negative" film. There was VERY likely no "CN27" when that camera was made - 400 ISO color negative films weren't marketed in the late 1950s AFAIK.

"Agfacolor K" was a tungsten-balanced color negative film. "K" could have been for "Kunstlicht" (artifical lighting) or "Kelvin", as a tungsten film is designed for a different color temperature in Kelvins.

It would appear that different Silette models, and probably also their export versions, had varied values on this dial (eg old english language manuals seem to suggest some models had ISO values).

This camera was mainly intended for use by amateur photographers who only occasionally used the camera. Film was loaded, some pictures taken, the camera was generally set-aside to be picked up latter for an occasion. This second or perhaps third session might be next week or next month or even next year. When the roll was finished, then it was sent out to the photofinisher for developing and printing.

What I what you to understand, it was common for the loaded camera to sit in a drawer for some time. Naturally, one tended to forget what type of film was loaded.
The letters and numbers on the wheel you have discovered is a reminder. The letters stand for film types. The lettering, in in English was CT for color transparency (slide film) -- CN for color negative film, B or BK for black & white.

In that era, film speed testing was carried out by the various standards bureaus of counties. In North America it was ASA (American Standards Association). In Germany it was DIN (Deutsche Industrial Norm), BSI (British Standards Institute), in Russia GOST etc. Each used different methods, it was confusing, all were consolidated under the authority of the International Organization for Standardization of Geneva and now called ISO.

The DIN system of Europe was Logarithmic. 100 ISO = 21⁰ -- 200 ISO = 24⁰ -- 400 ISO = 27⁰ (approximate conversion.

However, the wheel was a reminder device, it is not connected to the camera’s mechanism, it serves only to remind the photographer what film was inside.

I don't know about the "CT" (my guess is that it reads the barcode from the film cartridge and automatically sets film sensitivity) but the other numbers are clearly DIN settings corresponding to ASA (and nowadays ISO).

ASA100 corresponds to DIN21°, and basically you go up 1°DIN for 1/3EV, so ASA200 corresponds to DIN24° and ASA400 to DIN27°.