Hope this clears things up, and feel free to correct me if I'm wrong. Sorry for the delay in response; it's hard to explain, but the LSD affects the way the driven wheels turn; when and how much of it.
I usually only play with the LSD "Accel", since setting it to a numerically lower number prevents spin-outs when you accelerate out of a slow corner.
The "Initial" part confuses me; it tells the wheels when to move (sooner or later, depending on the setting). i usually don't mess with this setting, since I find it doens't have predictable results.
The "Decel" setting is how the car behaves under braking; I've found only very high-powered cars need a serious adjustment. But cars that tend to lose their grip under hard braking could use a numerically lower setting to "shape up" the car under braking.
Settings are all a matter of taste; some people want the rear wheels to break loose in a corner (entrance), some like it to occur out of a corner (exit), depending on where you like to place the apex of a corner.
For FF: I make little to no adjustment; if it understeers, I dial in a larger number for "Accel" to rid the car of understeer. Too much makes the car jumpy. I leave the rest alone, with a few exceptions.
4WD: This depends on where the engine is; in a mid-engined four-wheel-drive car, I set the LSD settings just like a Mid-engined, rear-wheel-drive car. There aren't too many cars like this (Delta S4, RS200). Most cars are the front-engined, all-wheel-driven style better weight distribution than FF, still not as good as the FR, in my opinion. But you have more confidence in throwing the car about. Well, since ther are two separate settings in 4WD cars, I usually dont tinker withem much because it makes things a little more difficult; but an understeering car usually gets a higher Front Accel rating, and if it's also very powerful (R34, for example), then I lower the Rear Accel value.
I try to make these cars handle on the throttle, so I lower the "Accel" setting to prevent the car from snapping sideways unexpectedly and spinning. I prefer sideways action at my command, not the car's! Usually, the Decel setting needs lowering, because that's another way the MR car spins out. I tune RR LSDs similar to MR cars.
FR was left out; usually, I make the Accel setting a lower number, depending on the car's behavior under braking, I make the odd Decel adjustment and sometimes change the Initial depending on how soon I want the power delivery.
The best way to learn about your LSD is to take an FR car you know well, that's also not too powerful (say, 200-300 hp...an old Silvia K's or RX-7) and play around with one setting at a time. If you use an 4WD car, you'll have twice the settings, so work slowly here.
Remember to only make one adjustment at a time; when you fully understand all the settings, what they do and how to use them, then you can make several adjustments at once. The Test Run feature helps quite a bit here.
Also, keep in mind that no two cars have the same setting; not all FR cars and not all MR cars have the same setup.
