What exactly does the box "disable my LibGuides profile page, but still allow my profile box to be displayed on guides that I create" mean?
That box is actually referring to a feature improvement that we've recently implemented in LibGuides. Within the LibGuides system, you now have two "Profile" entities - a profile "box" and a profile "page". The profile box is what appears within your guides (and can be toggled on/off within each individual guide you create). The profile "page" is an extended version of this, and is accessed either when a patron clicks on your profile image from within a guide, or when a patrons browses by "Author" and selects your name from the home page. Here's mine from the Demo site: http://demo.libguides.com/profile.php?uid=20288. You can customize this page within your "My Admin" screen to include different kinds of information (beyond just the guides you've created in the system).
When we implemented this feature, we heard from some folks that their LibGuides system had guide authors for whom they wouldn't want to display a profile page - generally this falls into the category of IT system administrators and/or web presence maintainers (such as student employees). So that box you're seeing is a reflection of that - some institutions don't want particular accounts to appear in those larger profile pages, so the box provides an easy way to turn them off.