Looks to me like you will set the discrimination up to reject what you don't want to find and then set the tune as high is it will go and where it starts to run unstable and then back it off until it runs smooth and quiet. I would hold the coil up in the air when doing so OUTSIDE. Concerning the discrimination settings, you will need some pulltabs, different types of change to include a silver coin and a rusty nail to set it up. Write all your settings down on the discrimination to know what each number will discriminate out. Concerning the tune, it would all depend on the soil conditions, EMI, etc..
I would assume you want a constant but low hum in your headphones. You'll achieve that by hovering over the ground approximately 1/2" or so and hit retune. You should be able to tune the audio to your liking. Too low, it's losing sensitivity, too high and you are running out of audio threshold. Having said all that, I am not familiar with this particular unit. Most of our older units worked similarly, so I hope this helps. You should be able to find a manual for it somewhere.