The first generation of Traktor Kontrol S2 machine only had the USB display light on and other buttons did not respond when operated on a Windows 10 system computer and Traktor Pro3 software. What is the problem
I was under the impression MK1 is no longer supported or needed some extra work to get it going, but I could be wrong, but have a look at the link below and let us know. [edit: you are running Windows 10]
https://support.native-instruments.com/hc/en-us/articles/4402975722897-Support-for-Older-NI-Products
Did you run the setup wizard to start from scratch? Also I do note you are running Demo mode.