This dialog allows you to choose your current sound driver, the frequency to use, and whether to max mixer or not (only in allegro, not with the seal version - dos and win32 use seal by default for the audio). Notice that if you choose a high frequency then it will require more cpu time to be rendered. The default of 22050Hz is probably the best for most games (I don't know any game with samples higher than 22050 Hz, so 44100 Hz can make a difference only with FM music).
In 0.35 you also have a new checkbox ``Max mixer volume''. This checkbox not only makes the mixer volume maximum, it also disable an allegro feature which tries to remove any distorsion in sound by making voice volumes lower. If your sound is really too quiet you can try to check this box. It is very efficient at making sound louder !