Click the playback gadget's eye button to look at the recorded aircraft.
That's basically the entire purpose of that button. It is not a toggle-style button. Clicking it when it is already activated will do nothing.
When the recorded aircraft is the current "look at" target, the button has an orange stripe underneath. If you use the 'T' key to change between the recorded aircraft and your own live aircraft, you will see the stripe appear and disappear as appropriate.
I am not aware of any bugs with this button. Are you seeing behavior other than what is described above?