I took the right cover off and sprayed contact cleaner in the switch and cycled it a few times, put back together and it has been working for the past couple of weeks. IDK if you can just spray contact cleaner from the outside and get it into the switch because of the shape of the switch cover.
It is not supposed to turn loose and freely. Try bugging logitech to make a similar device, but they would probably want to make it feel like the surface dial because most people love it for how it feels.