AWAR's link basically sums it up. You'll get a feel for what settings suit you personally (for example I can't stand not having anti-aliasing, and would lower other settings in order to have it with a reasonable fps).
By the way, FPS is frames per second. You can measure it using Fraps. Generally upwards of 30fps is needed for decent gaming, 50-60 is optimum for fast paced games. Higher graphics settings will mean lower FPS, so if you get low framerates or juddering images, try lowering graphics settings to see if it improves. As mentioned in the article, Vsync issues can also cause juddering.
The best thing you can do to learn is to find a fairly intensive game with lost of graphics options, and then experiment.