Behr A/C Switch questions

[mm8991]

I recently updated my carpeting and dashboard cover, and I installed a restored radio. During those projects, I needed to drop and reinstall the Behr A/C assembly from the bottom of the dash more than once to get it out of the way during these projects. After I got everything buttoned up, I reconnected the batteries, and found that the A/C blower fan was blowing at full speed, even though the ignition key was OFF, and the A/C fan switch was in the OFF position. Assuming that I had created a short somewhere, I loosened the four mounting screws attaching the A/C assembly to the bottom of the dash and started pressing the A/C assembly in various places around the switch. I could get the fan to stop for a moment, but then it would quickly restart on its own again. I pulled the unit down completely and removed the screws that hold the top half of the assembly to the bottom half, and I could see arcing around the switch. So I disconnected the batteries and removed the switch to clean it (with electronic cleaner spray) and look for problems. When I removed the switch, I noticed that there was some sort of round device with two red wires and a small (asbestos?) insulator pad that was laying in the switch cavity. It almost looks like the pad was supposed to be an insulator between the round device and the two rivets that secure the resistive wire coils within the switch (I could see the two rivet indents in the insulator pad). It seems possible that if the insulator pad was displaced that I was seeing a short between the round device and the switch contacts. This must be a high current switch, hence the heat-related insulation protecting the plastic housing around the switch.

The switch seems to be working properly on the bench -- the OFF position is an open circuit, and the other switch positions have different resistance levels, which I suspect retards the fan speed in switch positions 1 and 2 (seems logical since the fan speeds are not really much different between 1 and 2).

Can anyone shed light on what I'm looking at, and how it is supposed to be assembled? What is the round device with the two red wires? Is it some kind of thermistor that opens the circuit if the switch overheats? Anything that I should be checking and/or avoiding? Pictures below...