The available options for Item Approval
* No Approval Needed
* Approval On Create
* Approval On Create and Update
The differences should be clear, but just to iterate, here is the help text from that field.
Quote: When a new Item is created by a Profile in this Quota, should the item be placed in a pending state before being visible in the system?
No Approval Needed: item is immediately visible.
Approval on Create: item will need to be approved by an admin after being created.
Approval on Create and Update: item will need to be approved by an admin after being created or updated.