Buffering means loading the video ahead of time, so that there is no lag when the video actually starts playing.

If you set this to "Yes", then as soon as the page loads, the video will start buffering ahead (buffering not the same as playing).

If you uncheck this, then video will start buffer ahead only after viewer clicks the play button.

Also, if you wish to show the first frame of the video, then turn on buffering. This also means that any splash image you set for the video will not be shown - the first frame of the video will become the splash screen.