This setting is found on the Patch Management Imports for PM 7.0 / 7.1 (Microsoft and Adobe) and PM 7.1 SP1+ (Import Patch Data for Windows)
To summarize: A revised update is seen as a 'newly added' Software Update, as the developing vendor has altered the old update in some way. Patch Management, seeing it as a 'new' update, will disable the check box to deploy the package for this update on the Software Update Policy > Advanced Tab. This setting allows Patch Management to continue to deploy this 'newly added Software Update' after it has been updated through the 'Automatically revise Software Update...' policy.
This setting does NOT deploy any updates that have not already been Staged, and does not already have an existing Software Update Policy, for it simply ensures the advertisement for the individual Software Updates remain enabled following the Revise Software Update policy completion moving forward after this setting is enabled.
Note: The process is not retroactive and will not enable the advertisements for revised Software Updates prior to this setting being enabled.
Assist: Please view KM: TECH40390, for it details this behavior and provides further tools (SQL reports / scripts) to assist with cleaning up unwanted Software Update Policies.
Advisory: An enhancement request has been submitted to review the naming convention of this process, for the wording '...newly added...' tends to promote the idea that the current month's released updates will be distributed.