Josh
Is it, by chance, a variable trimmer cap?
I wouldn't yank it out until you can confirm what it is and its function.
If your TRF has one of these condensers for each stage, then all must be adjusted so that all of the stages tune as much alike as possible (if they are all linked together mechanically). If not, the stages will be out of sync with eachother. Narrow selective tuning won't be possible. Sensitivity will suffer wherever the stages are out of sync (not all tuning in exactly the same frequency).
Thomas