Nicolette, I don't know how you found this, but I appreciate you posting the tip.
You are correct, this setting change really helps SSAO shadows "blend in" better with stencil shadows.
I have an ATI Radeon HD card and the current driver, and with the default setting, there was signficant "noise" in the SSAO, making fuzzy or speckled overlays around the base shadows.
I did some experiments and anything above about 1.5 starts to clean up the speckles, expect that as you tune the value, somewhere between 1.5 and 3.0 will look "best" depending on card and driver.