If you will be hosting the FVTerm application in an iFrame on a web page that will not enable cross-site scripting (any web page loaded from a different server or the same server but a different port), you need to set this value in order to enable interaction between the FVTerm application and the hosting page.
For example, if you have a SharePoint site running on .NET Framework 2.0 and need to host the FVTerm application in the SharePoint pages using the FVTerm web part, you need to have FVTerm run in on a site that has a different port. For example, the "Default Web Site" on a SharePoint server may be setup for port 8080.
If the SharePoint site is sp1.mydomain.com, you will need to set the javascript "document.domain='mydomain.com'" in the SharePoint master page, then in the FVTerm web.config have:
<add key="setDomain" value="myDomain.com"/>
You will also need to edit the SPTerminal.html file that is used by the SharePoint web part so that it includes the javascript:
document.domain = "mydomain.com";