The thread dial indicates movement of the carriage relative to the leadscrew. With the leadscrew not rotating move the carriage along the bed the distance required to turn the dial one revolution. I would expect this to be 2" but it may be 1".
This distance is divided up by the marks on the thread dial. If you have 2" of travel and 8 marks then each mark is 1/4" of relative motion. If it is marked 1 to 4 with the intermediate marks not numbered then the numbers show 1/2" of relative motion.
This works as follows.
Any even numbered TPI value can be engaged at any numbered position. Eg 2TPI, 4TPI, 6TPI etc.
Any TPI value that is divisible by 4 can be engaged at any numbered or un-numbered mark. Eg 4TPI, 8TPI 12TPI etc.
Odd numbered TPI values should only be engaged at opposite marks on the dial eg 1 and 3 or 2 and 4.
Very odd threads with a 1/2 on the end such as 11.5TPI should only be engaged at the same point on the dial through the threading process for example the indication marked 1.
For a beginner it is easiest to stay safe by only using the line marked 1 until you are happy you know what you are doing.
Martin
This link to something I wrote on this subject may work but it is to a Yahoo Group and it might be closed to non-members.
https://xa.yimg.com/df/smart_and_brown_lathes/Understanding+the+threading+dial+.pdf?token=b8UcLiy8FkHOFeZ59SP-GnG0_mV9-cUnqX-c7yGn0WjmuZc28fruhLfSA8qxVftXll7vY5LlmOlGDXuXl9f1uYcBb0wnthFS43C7RuTnpt3GsNIdfi4kTggDe52ntCBjG7ZySNfVJN58m6eE&type=download
Edited By Martin Connelly on 21/11/2017 13:34:09