Vintage 1950's and 1960's Pfaff 332, 260, 262, 360, and 362 sewing machines are lubricated with an oil that over time, becomes a varnish, and literally glues the machine's pivot points together This causes the machines to be locked up in whatever mode they were last used in. Typically, resulting in a zig-zag function that no longer works, including a zig-zag knob and lever that are frozen. Often times the stitch length knob and reverse stitch lever are also frozen. In extreme cases, even the mainshaft through the top of the machine, and the levers that move the needle up and down will be frozen, as will the shaft and levers that operate the bobbin and rotary hook, as well feed dog assembly.
The Pfaff service manual actually recommends placing the machine over a pile of newspaper and pouring diesel fuel or kerosene through the machine. This probably works great, but I've yet to try it.
My method starts with liberal spraying of penetrant, like Kroil, PB Blaster, or Liquid Wrench, and then applying heat from a hair blow dryer to the internal metal components. This usually works great. However, if this doesn't work, I remove the cam assembly and take the machine apart just enough to physically clean the seized components with carburetor cleaner.
This video offers a cursory review of the more extensive repair process.