This field is used for 2 purposes:
1) If you wish to use a completely different main S3 bucket that's different from the bucket name entered in Settings, then enter that bucket name here. It should already exist. This allows you to use files from different main S3 buckets, even though the main Settings page allows for only one main bucket settings.
But if have only one main bucket in S3 (doesn't matter if it has sub-folders) and you've already entered that into the Settings, or if you're not sure what all this means, then just leave this blank.
As long as you've entered a bucket name under Settings, you can leave this blank and not worry about this field.
2) If you wish to create a Video Playlist or Audio Playlist or an Instant Media Page (IMP) with the contents of an entire sub-folder, without having to create individual shortcodes for each one of the files inside, then enter the name of the sub-folder here, starting with a "/" (slash, minus the double-quotes).
So if your bucket name is mybucket and under that you have a folder named audiobook, then enter /audiobook here (even if mybucket is the name of the bucket in the main S3MediaVault settings).
And now, if you create a new shortcode and choose "Audio Player (Standard)" and enter /audiobook in this field, then all MP3 files under /audiobook will be turned into an Audio Playlist on the page where you embed this shortcode.
Or if you create a new shortcode and choose "Video Player (Standard)" and enter /videos in this field, then all MP4's under /videos will be turned into a Video Playlist on the page where you embed this shortcode.