Preview on Print
Normal report printing consists of a report being created by a program, and then being sent to the PC for printing. The "Preview On Print" option allows you, the user, to control the circumstances under which those reports from the host, received for printing, are instead displayed on your screen. The "Always" and "Never" options should be fairly clear. The two "Application Control" options allow you to let the program that created the report determine whether the report is previewed--and gives you the option to say what happens when the report program doesn't specify anything.
There is no right or wrong, or best or worst, setting for this option. It is strictly determined by (a) your needs and objectives, and (b) those of your work environment.
The default value for this setting is "Application Control, Default=Off", which means that (a) APEX is expecting to receive a launch or don't launch command from the program that generated the report, and (b) if it does not get such a command, it will NOT launch.