From what I can tell it only seems to give the positions of things from when they first appear in your line of sight. So a unit will get built and then drift strangely into position and wait until the point of the game when it was discovered before carrying on as normal.
That was just thrown in there because it was requested to be able to scale the AI. The final version will be much better.
What Sorian said. This was just a temporary work around to make sure people could scale the AI a bit more. We expect to include a lot more options for setting lobbies, not just AI games, but also vs other players modes.. Handicapping, limits, etc. So for now? No, we won't be making this feature as is work with players. It's too much effort for work we're not keeping. We'll have the real way to do this coming.