Wow, I was all set to have to do a full troubleshooting flowchart on my 2003 Forester, since the cruise stopped working. It was that little rubber plug missing. Once it's gone, the switch button neatly fits through the hole in the clutch pedal arm. I have to say, I don't understand this design at all.
I put a couple of thin, felt sticky pads (furniture pads) over the hole, and cruise is working as it always did. Thanks, gbrand.