This affects references/occurrences finding and variable renaming. An example from Kirk:

function Write-Item($itemCount)
{
    $i = 1

    while ($i -le $itemCount)
    {
        $str = "Output ${i}"
        Write-Output $str
        $i = $i + 1
    }
}

If you attempt to rename the variable $i, the instance inside of the output string does not get renamed.