The % is a group operator that obeys inheritance. For example, say you have the following groups in a linearly privileged order:
superadmin
admin
operator
respected
user
By default, respected's can_target should be "!%operator", which basically means: "respected can target any group that does not inherit from operator"- which means they can't target superadmin because it inherits from admin, which inherits from operator.
We have a '#' group operator that does not check for inheritance. If respected's can_target were "!#operator", then they could target admins and superadmins, other respecteds and users- just not operators.
Keep in mind that both of these cases are based on the fact that your inheritance tree doesn't branch (i.e. you have two or more groups that inherit from the same group). If you do have branches, then it's a bit more difficult to get permissions set up correctly.
