Allowing your map to use the latest melee balance will make it use any changes Blizzard makes to melee. If your map is a modified melee this generally is a good thing as you want your map to follow the standard game balance (like you want all Tavern heroes to appear or want new things like the Ritual Dagger, Sundering Blades, and charged items like the one that summons Blue Dragonspawn or something similar) to be applicable on your modified melee map. The only problem is that if you are making a non-melee map (like Tower Defense, etc.) since changes Blizzard make to melee balance could break parts of the map.
The latest patch released by Blizzard a few days ago worsened the situation with the devs removing two important folders (balance and deprecated), which are used for storing an old custom map data and SD water textures. As such, you are forced to play all custom maps or even the vanilla ROC campaign with completely broken balance (in other words, the latest TFT data). Additionally, if you are trying to edit your old maps with World Editor, you have to allow the map to use the "Relative Upgrade Cost" feature (this option was disabled by default right now, so you have to set it from "False" to "True").
Anyway, since you are using the older versions of the game (and not Reforged), it's a very safe option for making maps with the latest melee balance in TFT.