Not sure about a presence control on a guitar...
On most amps, the presence control is supposed to give you better control of the high-end (treble) frequencies. Do you notice a big difference in tone when you adjust it while playing? Again, not sure about a presence control on a guitar and not sure what kind of guitar you have there.
Someone is going to need to elaborate on this, but it has something to do with the treble response I think. But, I'm not too sure, so I'll shut my trap and let someone who knows do the talking... Of course, you could just start jacking around with it too, and see what difference it makes in the sound.
Presence is pretty simple, add more= brighter tone (sort of like a treble boost but not exactly the same) turn it down= more of a mellow tone. Use it to control the "crispness" and "bite" or to give an acoustic/electric a little more "ring." It can help to accent certain efx.
My understanding is the same as the definition Kevin DeSchwazi gave.
Upper mids that make the instrument sound more, well, present. that little something to cut through the rest of the band sometimes (like going to 11 I suppose). Usually an amp control I don't use the knob on my amp much as it isn't really necessary with my single coil MIJ thingo - the bridge pickup cuts through custard as well as band noise.
Presence Frequencies - The range of audio frequencies between 4 kHz and 6 kHz that often, when boosted, increases the sense of presence, especially on voices.
The knob you are referring to cuts and (probably) boosts frequencies in the presence range.