Blend Spaces warning

[frailer]

Was Exporting a LoRes PDF from Indy, after Placing for proofing. The HiRes I created separate for the RIP. This was for emailing ahead of the Black Magic...(Monday).
When I have the Output setting as per pic1, I get the Error in Pic2. Pic3 setting I don't get it.
OK, I "tinkered", but what is it that I'm being warned about? No biggy, but would like to know. I have an intuition about it, but wanna know exactly why, I guess.