The switches are to tell the Macintosh Video Controller about the capabilities of the attached monitor when the monitor is NOT a Macintosh Proprietary Monitor. Macintosh Monitors individually perform the the position setting for their type so the controller knows what sync and resolution capabilities are on the other end of the wire, usually fixed for most Pre-G3 Macs.
The adapters started appearing in the early-mid 90's when sVGA Monitors capabilities were beginning to exceed those of the legacy Macintosh displays. Especially the large 17"-21" Glass tubes with the finer screen pitches which the Publishing industry was gravitating to. Other monitor vendors also made their own adapters to perform a similar function.
sVGA Monitors are essentially MultiSync, though Macintosh Multisyncs only have a narrow range they would sync within for each defined resolution. Apple finally made the switch to HE-15 output with G3 models.