What the option changes
Customer Acquisition has carried bidding options for some time. "Report on new customers acquired" is the reporting-only member of that group: selecting it turns on the New customers and New customer value columns and applies no bidding adjustment.
The workaround it retires was widely used. Advertisers who wanted new-versus-existing segmentation without the bidding behaviour selected "Bid higher for new customers" and assigned a new-customer value of 0.01, small enough to be immaterial to the auction. That is a settings hack carrying a live bid modifier, and anyone auditing the account afterwards had to know why it was there.
What has to be true before the columns mean anything
Customer acquisition reporting works only with Purchase conversions. It also depends on a new-customer signal actually reaching Google, supplied through the Google tag, Google Tag Manager, Shopify, Firebase, Google Analytics, or an offline conversion import. The implementations differ: the Google tag on Ads tracking takes new_customer as true or false, Analytics tracking and Firebase take customer_type as new or returning, and API uploads pass customer_type as a string.
Google defines a new customer as one who has not purchased within a given time period, recommending a 540-day lapse window, and a returning customer as one who purchased inside it. Where that classification comes from is your side of the wire. That is why the option can be switched on correctly and still report nonsense.
What to do about it
Check what your tag sends before you read the columns
Run a test purchase and look at whether the conversion carries new_customer or customer_type at all. A store on Shopify or a standard Google tag install may already send it; a custom checkout very often does not. If nothing is sending it, the columns will fill with a number saying every buyer is new, and that number will look plausible enough to plan against.