The option to hide a category should only be used if you really HAVE to. For example, perhaps you have very seasonal products, and one category is called "Christmas Gifts" and you want to only show categories that apply to the current season. You should only really use this feature if you do not plan to show the category and its products contained within for a lengthy period of time (many months), and you shouldn't use it for short periods of time.
The reason for caution is because hiding the category will automatically hide all the products contained within the category (which could be hundreds or thousands of products), and that will mean these products are not available to your visitors AND also not available to search engine spiders. If you use this feature often for a number of your categories (toggling between hiding and showing regularly), it's confusing for search engine spiders who may routinely see hundreds of your website's pages suddenly unavailable (or suddenly available).
Having said all that, this feature CAN be useful for certain situations - particularly if you're not 100% reliant on search engine rankings for these products and can drive traffic to this category and its products via paid clicks (then it doesn't matter if the category is hidden at times of the year, shown at other times as your traffic is guaranteed).
By ticking the "Hide Category" box, all products within that category (including products within the sub-categories and sub-sub-categories) will be flagged as "not show on site". When you UNtick a hidden category, all products within that category will be shown on site. Please note that you may need to use backoffice > shop > edit multiple products if you want to still hide SOME of those products within the category that you have switched back to "show on site".
Finally, this facility has zero impact on your categories and website if you never use it (just to reassure you).
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