To be completely accurate, the new option does allow you to set the viewing preferences for journal pages (such as archane.dreamwidth.org or denise.dreamwidth.org) separately for the preferences for entry/comment pages (archane.dreamwidth.org/12345.html, denise.dreamwidth.org/12345.html). The "option 1" that ninetydegrees is talking about above adds a URL parameter so that all entries clicked from your reading page show in your preferred entry style (the one you use on your own account's entries); "option 2" lets you set it so that all entries on the site, no matter whether you clicked from your reading page or not, always display in your preferred format, which can be your journal style, the site skin's style, the light format style, or the account owner's chosen setting (which itself can be either journal-layout-styled comment pages, or site-styled comment pages).
So, under this proposal, if you chose to always view entry pages in your style or your chosen site skin, you'd still be able to view the journal's front page style (the one that shows at denise.dreamwidth.org) if you wanted; the viewing preferences are separate. For instance, I have my account set up to always show me the user's chosen journal style instead of my own journal style, but show me every single entry page in site skin (I hate custom styled comment pages with the burning fire of a million suns).
If you still wanted the option to view entry pages in the user's chosen style, there's a one-click link on the navstrip that will let you switch to it. Which only works if you're viewing the entry with a custom-styled comment page, not in the site skin, but there's a URL parameter to add to the end of the URL to turn it from site skinned comment page to user's style of comment page. (I think it's ?style=original.) So, you wouldn't need to go in and change your settings; you'd just click a link in the navstrip. (Or put some text in the URL.)
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So, under this proposal, if you chose to always view entry pages in your style or your chosen site skin, you'd still be able to view the journal's front page style (the one that shows at denise.dreamwidth.org) if you wanted; the viewing preferences are separate. For instance, I have my account set up to always show me the user's chosen journal style instead of my own journal style, but show me every single entry page in site skin (I hate custom styled comment pages with the burning fire of a million suns).
If you still wanted the option to view entry pages in the user's chosen style, there's a one-click link on the navstrip that will let you switch to it. Which only works if you're viewing the entry with a custom-styled comment page, not in the site skin, but there's a URL parameter to add to the end of the URL to turn it from site skinned comment page to user's style of comment page. (I think it's ?style=original.) So, you wouldn't need to go in and change your settings; you'd just click a link in the navstrip. (Or put some text in the URL.)