The Noise Blanker and Automatic Noise Limiter are used to reduce the amount of unwanted static, or interference you can get from many sources. Specifically these functions are mostly used for unwanted ignition noise, power lines, inverters, etc.
Receive filtering
You may notice that switching the NB/ANL switch on doesn't produce a big difference, and that's actually a good thing. Too much filtering can cause you to lose weaker signals from farther away. Instead, these receive filters are used mostly to get rid of unwanted electrical interference caused by your vehicles engine. We've already talked about the RF Gain Control and Squelch controls, both of which are very important to your ability to receive. The NB/ANL switch is much more subtle, and should normally be kept on to reduce unwanted interference.
Should the NB/ANL switch be turned on?
In almost all situations, the answer is yes. However, if someone is very far away, and you want to pick up the most faint of signals, you may need to turn this switch OFF.