Code density refers to the number and size of the square modules that make up a QR Code itself. As more information is embedded into a QR Code, the number and size (i.e., the density) of modules increases and the code becomes that much more difficult to scan by a code reader application.
Density 40 is very very dense. Probably unusable for most phone scanners at this point.
Density 1 is the minimum amount of density.
Auto will select a density value of 3.