1. The guys are right: cut-out pressure (around 125-135 psig) is unrelated to regulator setting.
2. If your compressor doesn't cut out, there are two possibilities. One is that the pressure rises to the cut-out pressure and the pressure switch doesn't cut off power to the motor. If this happens, the steam valve will blow and you'll know it.
3. Second possibility is that the compressor keeps running but never builds up to cut-out pressure, though it may well get above regulator setting (so you can get your job done). First thing to check is the dump cock on the bottom of the tank. This is there so that you can blow off the tank pressure and drain the water from the tank (which I do after every use; internal rusting is the major cause of compressor failure). If this cock isn't fully closed, you will get your reported symptom: continuous run without overpressure. If the drain cock is fully closed, then the rings on the piston are probably bad, and the compressor should be returned.
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