[Dickie]

I can't remember the correct setup procedure from the manual, but the principle of the AGC is to provide a levelled input to the schmitt trigger that is just greater than its hysteresis. That way the effect of noise on the input is kept to a minimum.
So in the absence of anything better, I would put in say 100mV at 1MHz, (not at all critical, but it needs to be rock stable), then adjust the pot. to whatever end stops the counter counting. Then adjust the pot. slowly backwards until the counter displays a stable, accurate reading. That should not be far off the correct setting.
I doubt if its a design problem or it wouldn't have got out the door.
And just to clear up an earlier point. the detector diodes are configured as a peak detector, one to ground and one in series. Its not a voltage doubler.