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Unless something has changed since I left the Episerver development team, this only applied to the legacy edit mode that was removed in Episerver 7.5, and thus the setting should beremoved.
We're in the process of updating the documentation for this and that's why I wanted to reply in this old thread.
Actually the setting is used. In the trees now (as of CMS.UI 10.10.5) access rights and language availability will not be evaluated when this setting is set to true. So there is some performace gains to be had.
And also as Linus mentions this setting affects the legacy trees. Those are still being used in admin mode.
From documentation:
Defines if page tree controls should evaluate if tree nodes have children. If set to false, tree controls will not evaluate if a node has children when it becomes visible. Only nodes that have children will display an expand icon ([+]), i.e. [+]NodeName.
If set to true, tree controls will not evaluate if a node has children when it becomes visible. Thus all nodes will display an expand icon, regardless of if it has children or not. This behavior will increase performance when displaying large tree structures.
I tried this on epi 10.9.1, but I only get the expand icon next to nodes that have children.