So I'm assuming you're talking about "use Nintendo Button Layout"
Disclaimer: I'm not 100% sure about any of this, it's just my understanding.
So there are actually a few different things here.
steam (in Big picture Mode anyway) shows you Button Prompts, for example, "circle" being "back" and "cross" being "enter".
Games showing you Button Prompts.
Where the back and Enter buttons are located on the controller. For Nintendo, the right most button (A) is Enter, while the one down (B) is back. Xbox has the Buttons and their functions swapped. Playstation in western culture is the same as Xbox, with "cross" being enter, "circle" being back. AFAIK, in Japan, Playstation is actually like Nintendo.
Now, what "Use Nintendo Button Layout" does, is changing 3 for the Steam menus. (maybe also in Games, I never tried). For 1., Steam should always show you the Buttons correspoing to your controller, so when using a playstation controller, it will automatically show you "cross","circle", etc. You don't need a configuration for that. For 2., That's on the game unfortunately. Some games have the option to use playstation glyphs, some only give XBox ones. For some, there are mods available. It has nothing to do with the option in steam.
Tl;Dr: that function swaps what button is Enter and what button is back in the Steam menus. Playstation is the same as Xbox, so no extra option. Does not change anything for in game.
Hope that helps, maybe not everything is 100% correct, but I'm assuming you ask because of in game buttons, and there the answer is, steam can't change that, the game has to support it (or mods).