A little hard to figure out what you currently have, but a few points from what I can see so far:
The dimmer has a rating of 600w120vac60hz5a. This means:
- 600w = Able to control up 600 Watts of power. That should be sufficient. Dimmers are often rated for much more power, but with CFL & LED lights that is not as much of an issue as it used to be.
- 120vac = 120 Volts AC, which is the normal voltage in the USA
- 60hz = 60 Hertz, which is the normal frequency in the USA
- 5a = 5 Amps. This basically matches 600w - 5 Amps x 120 Volts = 600 Watts. There are some reasons why VA is not necessarily the same as W, but not relevant at the moment since current/power overload is not the problem here.
Why doesn't the dimmer work for the fan? Because controlling motor speed is generally done using different methods from controlling lighting brightness. Under most circumstances, the preferred way to control ceiling fan speed is either with a switch on the fan (e.g., a pull string that switches between High/Low/Medium/Off) or a remote control specific to the particular model of fan. So the dimmer NOT working except when "all on" is actually as expected and not a sign of a problem with the dimmer or the fan. Note that even if the fan does work somewhat when on a dim setting, that is not good for the fan motor.
So switching to a regular switch is a very good idea.
Based on your numbering scheme, it appears that you have 4 separate cables going into the junction box. Some additional work will likely be needed to trace out what goes where...
1 - Based on the extra, currently unused, red wire, my guess it that this is the cable to the fan. Specifically, the fan should have been wired up with two switches. One would be for the fan and the other for the lights. The black & red wires are switched hots. If switched separately then one could be on a dimmer for the lights and the other on a regular switch for the fan.
It makes no sense that someone would have run a /3 (black/red/white) instead of a /2 (black/white) for the fan, unless there was originally a double-switch. My theory is that the original configuration was:
- two switches, one to black, one to red, fan & light switched separately
and then someone said "let's put in a dimmer for the lights", but found out the hard way that they couldn't fit a dimmer plus a regular switch in the standard box. So they said "let's just wire everything together" and changed to the current configuration which does not work properly as you already know.
Assuming that cable 1 is the cable to the fan, there is a very important question:
- Does the light currently work at all?
If the light DOES work and dims with the dimmer, then replacing with a proper double-switch requires correcting the wiring at the fan (most likely removing it from the ceiling to separate the fan & light wires that are both connected to the black wire and connecting one to black and one to red).
If the light does NOT work, then the black wire is connected to the fan and the red wire to the light and you can replace with a double switch without doing anything to the fan itself.
2 & 3 - Not clear what is going on here. My best guess is that one of those cables (let's go with 2 for the moment) is the cable from the panel. That would supply a hot black which is connected to the dimmer and to cable 3. Then cable 3 is chaining on to another device (e.g., maybe the switched outlet in the next box, but could be anywhere). You need to figure out which one is the hot. This can get a bit tricky if you have no experience. You must do this very carefully. What I would do - and the pros may have better ideas - is to:
Turn off the circuit breaker.
Disconnect 2 & 3 from each other and from everything else. Cap the exposed wire ends so they can't short to the box or to anything else.
Turn on the circuit breaker.
Check with a non-contact tester to see which wire(s) are live. There should be just one black wire showing power. If there is more than one, get professional help as this is just getting too complicated for a DIY new to electrical (in my opinion). If there is ONLY ONE hot then you have now identified the cable going to the breaker.
Assuming this works (only ONE hot), reconnect the wires as before. The wire that you identified as hot will now go to the common feed of a double-switch.
Now (provided everything above works as described - separate black/red for fan/lights, a single panel hot identified etc.) you can replace the dimmer with a regular double switch. Turn off the breaker again (obviously) and connect:
- Black from 2/3 to common feed of double-switch
- Black from 1 to one load connection of double-switch
- Red from 1 to one load connection of double-switch
4 - UNKNOWN It is unusual to have a black wire connected to a white wire. That may be related to another switch of some sort, but not very clear. In general if everything was originally wired normally (which we know is not the case because of the hanging red wire) then "connect everything you aren't changing back to exactly the way it was" will work just fine. However, that is not the case here (because of the hanging red wire and because of "fan on dimmer") so a bit of caution is in order. Identifying where cable 4 goes and what it does is a very good idea.