having read the entire series (and own it as well) i shalll take the precaution to place my responce in spoiler tags so that i will not spoil the story for anyone who does not want it spoiled
click to show spoiler
the switch that freya is talking about is just one of many unusual design characteristics inherant in the Chobit serries.
Chii (or Chi, depending on the romanization method used) is configured such that everytime she has *ahem* nookie or any time someone inserts something into her "feminine" region she reinitializes such that ALL knowledge and memories are erased and she will begin again from scratch.
this was partially done to protect her from being "invaded" before she found her 'someone just for me' and partially because icchan (the legendary creator of the game angelic layer and the inventor of the persocom) was a very eccentric man and wanted his creations to remain "innocent" no matter what..........