Question: I was just curious as to what exactly Sprite Kit Restitution actually configures? I know that it configures some behavior about an SKPhysicsBody's parameters, but how does the behavior differ?

Answer: 
Restitution set the bounce of an object, if you set it to 1.0f, the collision will be bounce back with the same force to the impact. If you set it to 0.0f if won't bounce at all.
Restitution basically equates to an object's "bounciness"