In summary of the four tests that been done since entering the basement several comics ago:

1 - Pressing the button with no real knowledge of what it does or how it works.

2 - Pressing the button knowing that it's powered by the wearer's own magic.

3 - Pressing the button with the above knowledge and knowing what the watch is supposed to do.

4 - Pressing the button with all of the above knowledge and using a password thought a particular number of times.

As certain as we can be that Tedd is bound to explain it all in a manner not dissimilar to Clarissa, I believe it should now be possible to deduce what Tedd was testing and why it was necessary to withhold information.

OR IS IT? Yeah, probably. BUT POSSIBLY NOT!