Max Delta time is for when the game slows down, as the physics starts to take a hit, the game will start to slow the time down in game to allow the system to perform all the physics needed. Before max Delta time was a known setting, larger ships would slow the game down and cause massive bugs, such as not even being able to be loaded onto the launch pad. The worst I ever had was over 45 seconds for the game to render one single frame, and due the the nature of the old system that 1 frame was showing 1 second of game time elapsed, and you could go from a fine ship to a full screen of explosion with no idea what failed. Now the game brakes frames down to a maximum amount of game time before displaying what is going on. So if you are not lagging you should notice no real difference what the setting is, but load a larger ship and see. The lower the setting the more smooth a lagging game will seem.