The I2C data is 'clocked' when the clock line goes from high to low. That mode setting changes where the line is between high and low. The ideal setting would be halfway between your 'high' and zero. So either 1.4 or .9V. Most I2C lines travel between the full range of 2.8V down to 0, so we argue a lot about if this setting is useful.
Obviously the I2C works in either setting - or you couldn't change the settings, but picking the right one will perhaps save you from be susceptible to random noise glitches.
If you are having noise issues on your I2C, it's definitely something to try.
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