If you have a statically set swap file size, then the swap file will exists still at that size, but Windows won't actually put any data there for storage. So it's still good to have a nice large swap file available.
I've got zero swap file usage right now, but I haven't been running anything lately. And of course I have 640MB of memory, so it'll be a while until there's actually a need to use the swap file.
Some programs will still use the swap file even with this setting turned on, however that is dependent on the application sometimes. As far as Windows is concerned, unless it gets low on memory, it won't use the swapfile (that's LOW on memory, not completely out of it; at some point Windows decides that it's getting too close to running out of memory and will start swapping, however I don't know what percentage that might be).
This is a good setting to be turned on no matter how much real RAM you have. You've GOT the memory, you WANT that to be used when it can be, not portioned out a little bit at a time by Windows while it uses a swap file just to try and keep memory free 'just in case'.