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What does it do? Easy enough, it swaps the shader count. The 'normal' count is 1920 for a 205W 6970 card, and the switch opens up the full force of all 2520 shaders. The reason this switch is set to 'low' is that between the clock speed advances, 730MHz/1920 shaders to 920MHz/2520 shaders, it blows the card through the 300W cap for PCIe cards.
This switch is an elegant way of going from sub-GTX570 performance to way way way over GTX580 performance, and still getting PCIe certification. Very slick guys, well done. If you don't have the right drivers though, the switch does basically nothing, which is why those who bough the card retail haven't seen the results they think they should get.