When do you use 3 gb/s over 1.5gb/s and what exactly does this mean?

It is the data transfer speed from ur Harddisk to your system.. It is a built it feature of HardDisks.. Unless u have compatibility issues or any other special cases, u shud leave the jumper to full 3Gb mode..

Set it according to what your system's HDD controller says it supports. The original was just called SATA, sometimes now labeled SATA 1.5 Gb/s. The newer is called SATA II or 3.0 Gb/s. If your system does not say SATA II or 3Gb/s, chances are it is the older system. If you know, set it that way. If not, you can try SATA II (3 Gb/s) and see if there are problems. If yes, change back to the slower setting.

How to set? On a SATA drive this is the only jumper on pins. Many arrive from supplier with one jumper on a pair of pins to set the drive to the slower 1.5 Gb/s rate because that always works. If you know is should be set to 3 Gb/s (or just want to try), simply remove the jumper and save it (just in case you decide to put it back).