The streaming-optimization option, often called Fast Start, rewrites an MP4/M4V file so that its container header and metadata are available near the beginning.
This can let a player begin playback before it has downloaded the whole file. The effect depends on the player and how the file is delivered.
Does optimization change video quality?
The optimization step rearranges the file structure; it does not re-encode the picture or sound. Any separate encoding selected by the processing preset is a different step.
Why can it take time?
Optimization can require rewriting the entire file. Even a small metadata edit can therefore be followed by a noticeable optimization step on a large video.
Allow enough time and free space for the rewrite. You can control streaming optimization through the corresponding processing setting or rule action.