It's the pattern of up or down and where the "FN" key is located.
For example, Up, down down puts the FN key to replace some other key (I don't have the manual in front of me).
Down Up Down I think puts "FN" on left Alt (which turns right fn into the default Menu key).
The left side shows which pattern of on/off/on/off puts the FN key on left ctrl, alt or win, and the right side shows which pattern puts FN on right alt or win.
All 3 dips set to up disables the FN key completely. (ON ON ON= fn disabled), OFF OFF OFF=default FN location.
Dips are partially broken in the latest firmwares; you have to move the dips while the keyboard is connected to the computer (which could cause damage, I don't know if that's safe or not) to make them turn on. They default to all "off" if the keyboard is plugged in.