The popularity filter is calculated is based on the number of times a particular item was clicked on across keyword searches and the position that the item displayed on the page during the clicks. At anytime we only look at the data for the last 30 days for this feature.
We recommend that you keep the value between 0 and 1 because we want to ensure that for search results relevancy still has an impact on the ordering and an item does not appear on top just because of popularity. In essence the score should always have more impact on the order than on the popularity for search requests. For example, let's say a user searches for keyword "watch". A watch accessory appears in the result, but because people end up clicking on the accessory more, the accessory might start coming on top of the results. This is undesirable since it is a less relevant result.
When you are navigating using the left navigation or top navigation, relevancy will not matter as you are using navigation as opposed to keywords. However, in this case since the items within the searched department will have the same score, if the popularity metric is turned on the items that are more popular will come closer to the top regardless of the popularity setting being at 1 or 3. We recommend that you turn this feature on in the staging account and ensure that the dev site is connected to our staging site so they can run tests on this.