Swarf machining is defined by having a line contact between the cutter (e.g. cylinder or conical) and the surface. Such line contact can be achieved only if the surfaces are ruled surfaces. Note, that surfaces are spanned in U and V domain and a ruled surface must have unlimited radius (flat) in one of these directions. In most of practical cases, the surfaces look like ruled, but an analysis of their surface mathematics result that they have not an unlimited radius in one direction. Instead they have a pretty big radius in a direction, which can be considered almost flat. This limit radius is defined by this parameter. In cases, where the drive surfaces to be swarf machined are not true ruled surfaces, and then the user must analyze the surface radiuses in the swarfing direction and provide an according radius limit to let the system use the surfaces as drive surfaces.
Please note, that setting this radius small or large does not affect the resulting tool paths in terms of gouging. Gouge check must be always done for swarfing by tilting the tool using side tilt angle. In other words, non-ruled (free form) surfaces can be swarf machined without any gouges using this parameter in an appropriate way combined later with gouge checking.