If you are engraving a JPEG image it will give you a different option named Bitmap Engrave Draft.

If you click on the little arrow it gives you a drop down menu for more choice:

Convert to dots means it takes your image and converts it to dots and engraves it in grayscale. More dots is darker and less dots makes it lighter.

Convert to patterns is similar to dots but it creates a pattern instead of a dot.

Vary Power changes the image to grayscale and engraves with different powers depending on if it needs to be lighter or darker.

So how do you decide which to use. It depends on what you like! If you have a small area available on your piece of wood, engraving a small shape at different settings is a great idea to see how each looks on your piece of wood. Practicing and playing with different settings is the way to figure out what you like.

Next with engrave, What is LPI? I found a great explanation of LPI on the Glowforge Community Page. It was written by Jules. They say this:
The LPI (lines per inch) number that shows up in the Glowforge interface is a measure of how many times the laser head is going to move back and forth over a particular area as it fills in solid areas of engraving. There is a sweet spot where it just covers everything with engraving, with no gaps between the lines, and no banding, and that seems to be in the 195 - 225 LPI range.

(Haven’t measured it…can’t prove it…it’s a subjective call. Feel free to run your
own tests.)

When you start getting into higher LPI densities, the laser starts cutting overmareas it has already cut, so the engraving gets darker and deeper. But it also increases the amount of time necessary to process the engrave with each increase in LPI, and I believe it also increases the amount of movement code that gets written to the file that gets sent back down to the Glowforge. So higher LPI settings will also frequently cause the file to hang up with an error message, especially if you are trying to print something that covers a large area of the bed.

The good news is, recent changes to the interface give us a way to deal with large surface area engraves. If you are engraving something that covers over about half of the bed in height, you can use the Draft Graphic (195 LPI) or Draft Photo (175 LPI) default settings that Glowforge provides, as opposed to the High Def settings, and the engrave will process without hanging up. You will still get complete coverage.

People familiar with doing Print work of any kind might find this hard to believe, since high definition is usually needed to get good photographic results, but you’ll do yourself a tremendous favor by speeding up the time it takes to process the engrave if you keep the LPI at or below 225, and you’re not going to sacrifice quality on large area engraves*.

*Caveat: As with all things in life, there are a couple of exceptions to this that are material related. When engraving on metals like anodized aluminum, tiles or other hard non-porous surfaces, you’re going to get a “crisper” result with a higher LPI value. For those I like to use the HD engrave setting. But you can just do an experiment or two to decide which look you’re going for.

Jules Glowforge Community

Post: https://community.glowforge.com/t/glowforge-interface-vector-filesmade-easy/14351

That explains the basics on settings for Engrave, but let’s break it down a little further so that you have more information on what settings to choose.

What Speed and Power should I use?

Glowforge Support has a good article about using Manual settings. This was written for their Performance Series but the underlying basics still apply to the Aura, the speed and power numbers will be different. In this article they explain Speed like this:

Speed

Speed controls the maximum speed at which the laser head can move around the printable area

How does this affect my print?

• Increasing speed decreases your overall print time, as the laser head can move more quickly around the printable area.
• Increasing speed decreases the depth of engraves, cuts, and scores, as the laser has less time to impart laser energy into your material.
• Increasing speed reduces the quality of a print. In the case of an engrave, the laser has less time to make an accurately positioned mark on your material. In the case of a cut or score, too much speed can result in the laser head jerking when changing direction, causing jagged lines and bumps in your print.
• Too much speed when cutting and scoring can also result in dark corners when the laser head changes direction. This is due to the additional laser energy put into the material during the between the the rapid acceleration and deceleration of the head.

In this article the explain power like this:

Power

Power controls the maximum amount of laser energy imparted to your material

how does this affect my print? - Setting higher power levels allows more laser
energy to be put into your material, causing your engraves, cuts, and scores to be deeper.

• Using higher powers than necessary can reduce the amount of detail in an engrave, as the laser energy can damage the surrounding area.
• Precision Vs Full Power The amount of power produced by the laser tube can vary in use. We offer two levels of power control, to maximize both cutting efficiency, and ensuring high quality prints:
• Precision power, as the name suggests, is precise, consistent, and lower in power than the maximum possible output of the laser tube. It’s ideal for cutting and engraving delicate materials such as paper, or when you require a very detailed print result.
• Full power allows the Glowforge to put more power into your material, whilst sacrificing some consistency. This makes it perfect for cutting, where we’re concerned with the laser going through the material, rather than engraving or scoring to a consistent depth.

https://support.glowforge.com/hc/en-us/articles/360033633574-Working-With-Manual-Mode

Lots of good information on how the settings work on the Glowforge dashboard.

 
On our website, craftcloset.com, we have a link to our Glowforge Performance series cut settings and are adding the Aura settings soon. (we are still testing our products with the Aura.) This will make it easier to add the settings in manually for cutting our Craft Closet materials.

So let’s get started with manual settings.

Cut settings.

Cut settings depend on a lot of things, including material type, thickness of material, power, speed, focus height. The best way to figure out cut settings of unknown material is by doing test cuts. You can use a small file like this,

To use this pick a row, for example the circles, and change the settings in the dashboard to different settings to find out what works best for the material. Each different color will show up in the dashboard as a different setting slot. For example, if I was testing a 1/8” wood piece, I would choose to cut the circles. In the pink I might put the settings: 15 speed, 10 power, 3 passes. In the Orange: 13 speed, 10 power, 3 passes. In the Blue: 10 speed, 10 power, 3 passes. And in the Purple 5 speed, 10 power, 3 passes. Then I would have it cut those, take out the piece of wood and see which one cut best. If none of them cut I would change the number of passes and try again. If they all cut I might try again with faster speeds this time or less passes to see what works best.

If you know the suggested cut settings for the material you can manually add that. I will write a different article on how to manually add materials to the Glowforge Dashboard.

So now you have the basics to get started, play around with different settings until you decide what you like for your projects!