What exactly does "Sync Google Contacts" checkbox in iTunes do? I have my Address Book configured to sync with Google Contacts, and I sync my iOS devices with my Mac.

There is also a "Sync Google Contacts" checkbox in iTunes, in the Info tab for the device. After selecting it, it asks for a Google account/password.

What exactly does this checkbox do? When I left it unchecked, my Google contacts from Address Book are synchronized anyway. When I check it, I cannot see any difference. It's confusing.
The UI for configuring Google Contact Sync in Address Book and in iTunes is intended to support the same feature. If it is enabled in one place and not enabled in another place, it is a bug in the Apple software.

Pre-iCloud, all contact syncing worked through a service called Sync Services. Google Contact Sync is one of the clients of contact syncing via Sync Services, and both Address Book and iTunes provide a user interface for enabling Google Contact Sync.