Yes, that is a lubricant. When one part moves in contact with another they can wear. The lubricant was applied to minimize that and maximize the life of the switch. I would not remove it.
Perhaps one of the fingers on the rotor of the switch is a bit bent and not making firm contact. You could gently, I SAY GENTLY, press on each of them in turn to see if that makes the display read correctly.
If this is a new meter, I would try to return it for a refund or replacement. Or contact Amprobe.