Hmm, now I'm second guessing if that piece goes into the tap inbetween the tap and the co2 line.
The co2 line has a gasket and such that looks made to stick right onto the tap piece. If I put the one way rubber thing in, I still can get a good tight seal but it doesnt seem right. See the pictures below.
I also want to know if what I'm about to try is ok or not. I have bought a air-psi gauge with an adjustable knob on it. It fits perfectly right on the regulator. So basically I'll have a regulator with both gauges and fine control for only $14 extra. Pics below.