if the other gun works fine,either the wiring through the gun tube or the camera is kaput. I know not what the pots are for, there is no documentation for them. perhaps contact sega service at their website and see if you can get some explanation of the function of the pots (segaarcade.com/support)
continuity check the wires, if they are good, you are looking at replacing the camera at a cost of about 400 bucks. (suzo happ has them or perhaps ebay)