In short: When you set spending behavior, you are indicating how aggressive or cautious you wish to be in the face of the random historical returns you expect year over year. In the Monte Carlo simulations, the return rate used to determine your earnings on regular and retirement assets is determined by the historical performance of your asset classes. However, even though you might expect a 6% return on average based on the historical performance of your asset classes, you may wish to approach each year cautiously and spend as if you will only earn 1% as a way to hedge your bet (not count your historical-return chickens) and thus establish cautious spending behavior (set a lower than expected return assumption) in the face of of these uncertain, random returns. If it turns out you do get the 6% historical average that year, the surplus you have that year (remember, you spent cautiously as if you will be earning only getting 1% that year) will be pushed forward and included in next year's calculation and, all things being equal, your new annual spending level for the future will be higher than the year before. You will not necessarily forever forego the advantage of this historical return expectation. You will, in this 1% example,  simply be cautious in setting your spending level so as to take that upside incrementally, one year at at time, only as it comes instead of assuming the historical average will show up each and every year perfectly on schedule.

In more detail: In the deterministic plan (i.e., base plan; non-Monte Carlo plan), your rate of return assumptions for regular assets and retirement assets are established with the same setting for spending behavior. You set them both with the same setting and spending behavior and rate of return effectively mean the same thing. This is one of the reasons that with the non-Monte Carlo deterministic plan, a plan that represents itself as precisely meeting all expectations in the future, that you should use cautious return assumptions, not historical averages. A deterministic plan assumes you will get for certain the return that you stipulate each year. A deterministic plan (your base plan in non-Monte Carlo mode) is designed to be a safety first, for sure plan. Because of this design assumption, for the plan to be useful you should enter a rate of return/spending behavior that lives up to this "reasonably certain" billing.

But in the Monte Carlo mode, the rate of return is introduced by the historical risk/return profile of your asset classes. So unlike in the non-Monte Carlo deterministic mode, you don't get to choose your rate of return. It is determined by your asset classes. However, you can still indicate a rate of return that sets your spending level. This rate of return is referred to your spending behavior assumption. Setting spending behavior allows you to represent how you spend--cautiously or aggressively for example.