This screen is intended to be used with the database localization provider. If you do not set this provider in the web.config, all the functionality on this screen is disabled. More details on localization providers are available in the tutorial.
In our experience, a great majority of users are using standard, "resx-based" localization approach. DB-approach gives you instant results but is difficult to share accross projects. If you plan to use your localization entries accross multiple projects, we recommend that you take the resx-approach. New version (beta is available) includes a small localization project that also allows you to instantly see how your localization entries fit in the portal design.