I see pictures of items and I can only guess at what they mean. There's no help text to speak of aside from the little help blurb in the menu, and I can't forbid specific items (pick up brimstone flasks, not softballs for example).
The items are their type, like cheese is food, softballs are throwing, etc. Making it possible to set for each single item would most likely be a nightmare.
I would like the auto loot to got into more categories. Like pick up Vegan only food, tinker only reagents, weapons only sword, Armors that don't reduce magic power, or potions that are helpful without alchemy. I'm not sure how the menu could do this but it would be nice.