The adjuster is installed from the inside of the drop-out, with the spring also inside. You use a small screwdriver to screw it in, then hold it in place so you can put the knurled knob on. The knurled end (knob) then screws onto the threaded end protruding on the outside of the drop-out. While holding the screw slot with your screwdriver, put that knob on tightly (otherwise it'll fall off).
Yup; the springs just to keep it from turning by itself.