That is mostly in use for the Mail Gateway functionality - when someone replies to a post via email,
e.g. you'll get a thread that looks like the following
Original Post
-----
First Response
ORIGINAL MESSAGE:
Original Post
---
Second Response
ORIGINAL MESSAGE:
First Response
ORIGINAL MESSAGE:
Original Post
I'm sure you can immagine by the 5th response, it can get pretty unreadable. So CS tries to determine where the email response is, so converts the thread to look like
Original Post
----
First Response
Click To Show Quoted Text
---
Second Response
Click To Show Quoted Text
Does that explain this better?