This is the most important moment of the installation. You need to decide if you want to install the program as an application or as a service. A service is just an application that is ALWAYS running in the background, even when no user is logged on the machine. Because Cobian Reflector is a scheduler, it's strongly recommended to install it as a service.
If you install it as a service you must take some things in consideration, though: If you install the program under the Local System account, you may not have access to other machines in the network, so if you are planning to access other machines, select "Install under a regular account:". Enter then the user ID and the password of the account to use. Some systems do not allow accounts which have blank passwords to be used to run a service, so use an account with a password. If you are using an account that belongs a domain, use the syntax DomainName\Account.