Cleaning up refers to fixing geometry data by creating proper topology, defeaturing, and eliminating extraneous vertices. The cleanup tolerance value specifies how much the geometry can be modified in the course of cleaning it, either manually or automatically. Since the geometry is approximated with a finite element mesh, a cleanup tolerance that is less than the node tolerance used in the mesh generation is required.
The tolerance value should not be set to a value greater than the node tol used for your element mesh, set in the Options panel.