Getting bad square-wave from the function generator
Yes, the schematic of the signal generator (page 8) clearly shows that it is AC-coupled.

IC4 is the output attenuator, and IC3B is the output driver. C4, C20 and C21 are the coupling between them. In conjunction with R7, they give you a time constant of roughly 1 second, which explains the "droop" you see on a 1-Hz square wave.

EDIT: The issue here is that the DAC (IC2) is single-ended &mdash; it can only produce positive voltages. In order to get an output that swings both positive and negative, the AC coupling is used to remove the DC bias.

If your application does not require negative output voltages, you could simply short out the coupling capacitors by installing a temporary wire across one of them.

If you do still want bipolar output voltages, but a much lower cutoff frequency, Google for the phrase "dc offset servo circuit". The basic concept is that you use an active low-pass filter to isolate the DC component, and then subtract this from the original signal in the output stage.

The point is, that it's much easier (i.e., more compact) to create a low-pass filter with a low cutoff frequency than it is to create a high-pass filter with the same cutoff frequency. For example, a 1 M&Omega; resistor and a 100 &micro;F capacitor will get you down to the milliHertz range.