Put simply, this button allows you to automatically target other players. Useful for the arena, completely useless everywhere else. No more clicking around like mad trying to get a lock on a player who keeps running in a circle like a dork.
Patch files can be found here.

EDIT: Suppose I should explain what the changes in each file do
keyboardconfig.cpp: Defines the button
keyboardconfig.h: Lists the button in enum keyaction
game.cpp: Defines a use for the key.
beingmanager.cpp: Adds a 1 tile deadzone so you don't target yourself with the button.