The trash folder is cleared of messages when you quit KMail if this option is selected. The following two options are disabled, if this one is enabled.
On exit, delete old messages if the trash folder becomes bigger than this limit.
The trash folder is cleared of messages older than the given age when you quit KMail, if this option is selected.
All messages queued in the outbox folder will be sent whenever you check for new mail.
This will compact all folders every time you exit KMail. Compacting folders means that the messages you deleted will really be removed.
To empty a folder means that its messages get transferred to the trash folder (and only get deleted if they are already in the trash folder). So although you normally won't lose any mail, you can still activate a confirmation dialog that will ask you if you really want to empty the folder.
This let's you configure actions for the arrival of new mail. Note that automatically fetching messages can be configured in your account settings under Incoming Mail.