Options
Click on this button or the menu item
to show the Options tabbed dialog box:

Display Options:
In the left panel, you can choose the appearance of the output image.
Choose Overlay
Source + Target White if you have a black and white map and wish to
display the black lines of the map in white where they correspond with
features in the transformed image.
Choose Overlay
Source + Target Black if you have a black and white map and wish to
display the black lines of the map in black where they correspond with
features in the transformed image.
Overwrite Target
uses the input image (Source) to overwrite the output image (Target)
after transformation regardless of the colour of the target.
Merge Source with
Target places those parts of the input image in areas of the output
image which are pure white, leaving the remainder of the output image
untouched.
White and Black
backgrounds create target images that show only the transformed data on
the respective white or black backgrounds.
If you have chosen
Mix as an output option, you can choose the percentage of mixture of
the source and the target image after transformation with the trackbar
next to the Mix button.
Inserting means that
if a source image pixel is not white, it is inserted into the target,
otherwise the target is left as it is.
The Xor option gives
false colour output which may be useful for testing the visibility of a
transformation to an image background like an orthophoto. It is
normally not used as a permanent result.
It is recommended to try various options followed by an Undo
to see what they do to your data. This must be done without using the
Transform and scale option which does not support undo, because it must
close the original images before displaying them.
Interpolation Options:
The transformation
calculates the colour or gray value at the position of an output pixel
from the input image. The interpolation option permits choosing the way
the pixel value is computed from its nearest neighbours, since the
transformed position usually falls inbetween four adjacent pixels. The
speed of calculation for each output pixel depends on the choice of
interpolation:

1) Coarse: the
colour or gray value of the nearest neighbour to the computed input
position is taken. This is the fastest method, but it may produce a
jagged appearance in straight line features (aliasing).
2) Medium: the
colour or gray value is interpolated bi-linearly dependent on the
values of the four neighbours and the distance of the calculated point
from them. This is nearly as fast as the nearest neighbour method, but
it blurs the result slightly.
3) Fine: the colour
or gray value is interpolated from the 16 nearest neighbours of the
pixel using an aproximation to a sin(x)/x (sinc) function which best
preserves fine detail. Since considerably more calculation is required,
this is the slowest method.
Reprojection Warning:
If you don't want to
be bothered by warnings when the reprojection error exceeds 1% of the
average side lengths of all images, uncheck the Reprojection Warning
box.
File Default Options:

Here in the left panel, you can choose to display either all supported
types of image files or only a single type which you select.
Similarly, you can choose the type of output file in the right panel.