jakeZincs explanation might be logical but its wrong. Collision size as the radius of a circle is used for various things (attack ranges, AoE spells).
Pathing however uses a rectangle and not a circle. The size of the rectangle is loosely correlated to collision size but even with collision size 0 the rectangle still has a small area.
Turning pathing off disables the rectangle for all kinds of things (units, items, terrain, doodads, map borders)