If this is checked, any image posts (i.e., posts of data type BMP, GIF, JPG, or PNG) will be displayed in rows of thumbnails, of the width specified.
In this mode, the thumbnails can be re-arranged by drag-and-drop. The space between two images will become highlighted when dragging an image over them, and if the dragged image is let go, it will get inserted between the other two images.
Clicking an image will open the slideshow window, which will display all of the images in the same folder. Use the left/right arrow keys to step through the images, and the up/down arrow keys to go to the beginning/end of the folder. Click the mouse to zoom in, or shift-click to zoom out. Alt-click the image to open it in the image cropper.