Don, your problem is not the smoker, or the knob; it's time. Unless you pre-heat the smoker (which we discourage, but I know some do in certain circumstances), you will not reach 250 in the time it takes to smoke a few thighs! Surely your smoke of 4 little thighs wasn't longer than about 45 minutes to an hour, was it?
You need to smoke something more substantial, like a good 4-5 lb chicken, that will take several hours. You are attempting to make a judgment on the accuracy of the smoker's capabilities with a very short smoke. If you smoke a whole chicken or turkey, I can almost guarantee your results will be fine!
And, seacoast, you are correct. Adjusting the knob will not make the rheostat go higher; the stops are internal, not in the knob. All this does is make the temp range more accurate. When I upgraded my #1 from a 300w element to a 400w, and had to adjust my dial so 225 was right. It doesn't let it go higher than the mechanical limits of the rheostat itself.