If set to true, you are free to add new users and groups to the system with the ordinary useradd and groupadd commands. On system activation, the existing contents of the /etc/passwd and /etc/group files will be merged with the contents generated from the users.users and users.groups options. The initial password for a user will be set according to users.users, but existing passwords will not be changed.
If set to
false, the contents of the user and group files will simply be replaced on system activation. This also holds for the user passwords; all changed passwords will be reset according to the users.users configuration on activation.