I just saw this setting, on the video setting page, the other day and it is off by default. If you have a widescreen, I would recommend that you turn on the "letterbox" setting, tip of the day ;).
The game is optimized for wide screen, 16:9, to be exact. If you already have a 16:9 monitor, it does nothing, but if you don't, it letterboxes the game. At any other aspect ratio (like 16:10, for a 1920x1200 screen) without letterboxing, the game chops off the sides, which keeps the screen full but reduces how far you scan see.
Dont really know what use it has.