[Tigga]

Yes, it will check through all forums except those that you added with the != in front of them. It will also check the forum permissions, so if a user doesn't have access to a forum, those topics should be excluded as well. And yes, it looks for the latest X posts and displays those. By the way, did you ever check to see if the forum permissions for those forums were set to not allow those groups to view others' threads? If all the permissions are set correctly, I'm pretty sure those threads should't be displayed anyways.
Also, if you would prefer for it to show the last poster and time instead, search this thread for "lastposter". I know I've posted instructions for others on how to change this at least once or twice.