The package selection menu is where you select which optional Mastodon packages you want to install. It's simply a checklist of all of the packages (showing their name and size) with a little scoreboard showing the total size needed to install everything. You choose packages to install by selecting that line on the checklist, then pressing [spacebar] or double-clicking on that package -- the package will be selected or deselected and the total size scoreboard will be updated. When you're done, press [OK] to continue on.
Some of these packages depend on other packages in the distribution, so if they are selected or unselected they will turn other packages on and off. Unselecting, for example, the Mastodon Applications package will turn off most everything that wants a C compiler or many of the traditional Unix utilities.