Olympus E520 question

[aussie girl]

Hi everyone. I have a question about my E520 camera. I was looking through the manual that came with it the other day and came across a "feature" that I am not sure how to use properly.
It is to do with the Image Stabiliser function (page 60/61 in the manual). I understand the explanation for the 'Off, I.S 1, I.S 2, I.S 3 function. It is the 'Setting the Focal Length' part that I am a bit confused about. I have only got four third lenses for my camera (they both came with it when I bought it) so I am not sure if this setting is supposed to be only for use with lenses other than four thirds type lenses.
It says in the manual - Quote :- By setting in advance the focal length of the lens, you can use the image stabilizer function also with lenses other than Four Thirds system lenses. This setting is deactivated when a Four Thirds System lens is attached.

So if I played with this setting and changed it from 30mm to 1000mm when I used my 300mm lens does this mean that because that lens is a four Thirds system lens, that it will not adjust the Image stabilisation in any way with that lens connected, or am I missing something?
What would I need to do if I used a 2x converter attached to the camera and then put my lens onto that? If it was a four thirds system converter would this setting be null and void with that converter (not sure if they are specific for various cameras or not)