Found on the organisation settings page, in the Defaults section:

True Shape nesting is the default setting. Using an L shape part as an example, the L will be interlaced together and then nested on the sheet.

True Shape nesting with 'Use Rectangular Bounds nesting for quantities of 1' selected will calculate the rectangular bounds of the L when the quantity is 1. Once the quantity exceeds 1, the system reverts to True Shape nesting (above).

Rectangular Bounds nesting will use the height and width of the part and take the rectangular bounds and create the nest. Regardless of quantity.