If you login with Facebook for the first time, you go to the login/register page like you see. If the user fills out the left side of the form (Login), this will then associate the Facebook account with whatever Joomla user they log in with. Later on, if they login with Facebook, it will log them into that Joomla account. If they use the right side form (register), it will create them a new Joomla account and everything will work the same when the log back in later.
Hope that helps explain that form. Another option you may want to use is the "Automatically Link Facebook Users by Email:". If this is enabled, if a user logs in using Facebook and there's already a Joomla user on the site with the same email address, it will skip the login/register form and automatically associate the 2 accounts.
For more information on the different user configuration options, see that page of our configuration guide:
www.sourcecoast.com/extensions/jfbconnec...ration-guide?start=4
Hope this helps, but if you have any other questions, just let us know!