All your translations into the database and disables the language files. This means that any changes you make using Translation plugin -> String Translation are saved in the database, and are not going to be overwritten by updates to your theme or plugins.
Note: Any changes you make within translation plugin will not get overwritten by plugin or theme updates since they are stored in the database rather than in your .mo and .po files. Your Theme and plugins localization settings are also set to use String Translation rather than .mo and .po files.
