I also import from the Epson scanner to Photoshop (Elements). I've never used the Save for Web function before but in looking at it on my PC, the Quality setting controls the amount of image compression applied to create your JPEG file. That makes the file smaller but since JPG compression is lossy your original cannot be displayed without some loss of detail. Setting of Quality in the Photoshop program can be from 0 to 100, zero being the most compression and poorest quality of the displayed image.

Note that JPG quality is not the same as Resolution. When you scan at resolution of 100 dpi, you get a display of your image at (approximately) the same size is your original. If you scan at 200 dpi, you get a display at 2 times the size of your original, and so on. Scanning at higher resolution gives you a larger file to transfer and store. However, when you scan at a resolution greater than 100 dpi, your file is created without loss if sharpness. That's why ebay now asks for you to scan at a higher resolution and upload the hi-res scan to store with your auction. They generate a lower resolution image for reviewing your auction picture, but if the viewer uses the "magnifying glass" feature of the auction viewer, your image is shown at the resolution you uploaded, which means you see a larger image (or piece of the image) on your PC screen.

These days with very inexpensive disc storage (a terabyte is not unusual) and high speed data transfer via cable (50 MBy per second is not unusual) the use of compressed images is less important. My disc storage was only a megabyte or so on my first PC and I was using telephone modems with 300 to 1200 bits per second data rates (this was only 30 years or so ago... the days of Prodigy and CompuServe). There was no Internet. Data compression was really mandatory if you were exchanging pictorial data and that's what caused file standards like JPG and GIF to be developed. Today, data compression is still around and because so many users communicate by smart-phone, it still is useful. In another 10 years, probably not.