The K10D/K20D has two buttons:
- OK (in the middle of the 4-way dial)
- Fn
In order to activate one of four functions, you had to press the Fn button and the corresponding 4-way controller direction.
On its own, the 4-way controller would move the selected AF point (if in SEL mode).
The K-7/K-5 have one button only:
- OK/Fn combo button (in the middle of the 4-way dial)
On its own, the 4-way controller would activate one of four functions as labelled on the four-way controller. In order to move the selected AF point (if in SEL mode), you now have to
first press OK.
Unsurprisingly, the user reaction was pretty strong (it led to many user errors from people knowing the K10D/K20D).
The custom setting 36 was added to address this.
It switches between the new (K-7, default "1") and old (K20D, "2") behaviour. In the old (compatible) behaviour, you have to press OK to emulate the effect of the Fn button. On its own, the 4-way controller would then move the selected AF point (if in SEL mode) rather than activate a function.
If you are new to Pentax, it is probably best to leave the K-7/K-5 at its default setting. Except if you
always move the AF point around.