Saturation would be what happens after a number of rounds are played and scores higher than your average no longer raise your average. It used to be 200 rounds when moving from TL to Champ but was updated with the release of TC.
Rounds with a final score higher than your average will move your average up and rounds with a final score below your average will move your average down. 9 hole rounds are doubled to make an 18 hole score when being applied to your average.
Hope this helps clear things up for you.