heh
I'm not a newbie (me thinks) but this seems to be something for really advanced users. At least there is no trace of it in the help.
I experimented with this setting On/Off, without any visible difference. My suggestion was setting this On will include an attached file sort of dynamically in the message when it is being sent, but the attachment will not be included in the saved 'sent' message (as it appears then in the 'Sent Mail' folder after sending).
However this is not the case (but such a feature would be really cool) and I'm also curious to know what's this setting for.