Recirc is for maxium cooling type situation. Think of it like this, if it is 105F and 80% humidity outside, if you recirculate the air from the cabin, you can change the difference in temperature between the air you have to cool/dry to something more like 75F and 40% humidity. You draw the pre cooled air from the cabin vs outside, and thus as the cabin cools, the A/C system can operate on intake air that needs less conditioning. There is always some amount of external air coming into the vehicle. I have never used recirc as a way to reduce exposure to outdoor air...but I suppose that works.
It is often easy to figure out if it is working, since the fan load decreases when in recirc as the fan does not have to overcome the pressure exerted by the vents to outside (cabin exhaust vents, usually in rear under the bumper cover). If the fan seems to "speed up" when hitting the recirc button, things are working.