Name adopted by setter in a novel proves amusing (10)
I believe the answer is:
entertains
'proves amusing' is the definition.
'name adopted by setter in a novel' is the wordplay.
'name' becomes 'n' (common abbreviation e.g. on forms).
'adopted by' means one lot of letters goes inside another (I've seen this in other clues).
'novel' indicates an anagram.
'setter'+'in'+'a'='setterina'
'setterina' is an anagram of 'entertais'.
'n' placed into 'entertais' is 'ENTERTAINS'.
(Other definitions for entertains that I've seen before include "Amuses" , "Thinks about" .)