General settings
These settings are the most important. There are three:
Normal format
The color/compression format that should be used if the texture is opaque.
Alpha format
The color/compression format that should be used if the texture has an alpha channel.
Texture type
If you imported more than one image, this determines what they will be used as (animation frames/cubemap faces/depth slices).
If you're making a plain and simple world texture you won't need to change any of these. If you're making a texture with fine gradient detail however, you'll need to choose a non-lossy compression mode.