This policy setting configures the "Enable Live Preview" checkbox found under File tab | Options | General. Live Preview ...

This policy setting configures the "Enable Live Preview" checkbox found under File tab | Options | General.  Live Preview shows how a command would be applied without actually applying it to the document.

If you enable this policy setting, the option is checked, and Live Preview will be shown when using Galleries that support previews

If you disable or do not configure this policy setting, the option is unchecked, and Live Preview will be hidden when using Galleries that support previews.