Proof of Work (POW) is traditional mining similar to bitcoin. People expend computing resources in order to find blocks, and the reward value is predefined.

Proof of Stake (POS) is an alternate method that uses proof of coin ownership to find blocks, instead of raw computing power. The block reward here is variable, and depends on how many coins were used to stake, as well as the age of those coins.

For novices, I would not recommend Pure POS coins, as they are more of a headache to manage. Stick to POW or POW/POS Hybrid.

SHA256: The original algorithm, the same one that Bitcoin uses. Use of this algorithm is generally not recommended unless you have a special reason to. ASICs (high powered, specialized mining devices) for this algorithm are widely available, which creates an unfair mining environment. Their availability also lends this algorithm to being vulnerable to numerous types of attacks involving hashpower (51% attack, etc).

Scrypt: The second algorithm made widely available, popularized by Litecoin. Scrypt also has ASICs available for it, however they are not as prolific as SHA256 ASICs and thus not as much of a threat to worry about. Still, this algorithm is probably not the best choice these days.

X11: Popularized by Darkcoin (now known as DASH), X11 uses 11 different hashing algorithms to arrive at a final hash, in a bid to stave off ASIC creation. So far it has worked, as there are no ASICs available for this algorithm. Only CPU and GPU mining is possible. This is a highly recommended algorithm.

X13: Similar to X11, X13 tacks on an additional 2 rounds of hashing, for a total of 13. It is very similar to X11 in that only CPU/GPU mining is possible. This is a highly recommended algorithm.

X15: Similar to X11, X15 tacks on an additional 4 rounds of hashing, for a total of 15. It is very similar to X11 in that only CPU/GPU mining is possible. This is a highly recommended algorithm.

For most people, X11 will end up being the best option.

Kimoto Gravity Well: One of the most popular difficulty adjustment algorithms, KGW adjusts difficulty every block using information from previous blocks.

Dark Gravity Wave: Heavily based on KGW, this algorithm combines multiple exponential and simple moving averages to smooth difficulty readjustments and mitigate some theoretical disadvantages of KGW.

Nite’s Gravity Wave: Slightly modified KGW.

Digishield: Another algorithm that adjusts every block. It is based on completely different math than all of the above algorithms.

All of the above options are very similar, and you can not go wrong when choosing one. I would personally recommend Dark Gravity Wave.

I personally would recommend somewhere between 2 and 5 minutes. The exact value does not matter too much.

For Pure POS coins, since there is no mining, it is up to you define this value. We then premine and transfer that amount to you.

The recommended range for this parameter is between 1-10%. Any higher and you risk causing hyperinflation, which unless you’re intending to do, is generally a bad idea.

Maximum Stake Age refers to the cap of coin age for reward calculation purposes. For example, if this is set at 30 days, and you have coins that are 90 days old, they will only generate rewards as if they were 30 days old.

Unless you know what you are doing, I would not recommend modifying this from the default values of 30/90. That being said, most values are acceptable, as long as they are not extreme.