I'm new to all. Confused on what the difference between saying Y or N or compiling as a module. Brief explanation would be nice. Thanks.

The kernel is a big hunk of binary that is loaded when you boot up Linux. A module is just a piece of that binary code separated from the rest, so it can be loaded only when needed (and unloaded when you're done using it). The idea is that you would compile something you might use (even though not very often) as a module, which makes the overall kernel a little smaller and potentially faster. If the option in question is something you plan to use all the time, then you'd probably want to just compile it into the kernel (by answering "Y").

Ok, selecting Y to an option compiles the code for the option directly into the kernel. It will always be there, whether your using it or not. Saying N means it won't be included, and thus can't be used. Choosing M means it will be compiled into it's own object file. This object file can be installed and removed as needed into the running kernel using the mod-utils (see man pages for insmod, rmmod, modprobe).