The View control is a little tricky at first, but the mechanics of it follow the same conventions as other elements of the application:
To restrict a user from viewing an item, click the "Browse Member Directory" button above the list of users to view a list of all project members. There are two types of users listed by default, and who cannot be restricted from viewing an item: any one with the "Cannot be restricted" project permission (typically the Project Manager role) and the item creator (generally yourself). This is why the checkboxes you see by default are grayed out/uneditable.
In the Project Member Directory, select the users you wish to restrict, and then uncheck the "View" box for those users in the Create/Edit item window. The default permission is that all users can view all items, so you only need to restrict specific individuals.
You are not compromising any data by restricting view permissions, you are just selecting whether a user can access the item. For example, if you restricted view permissions on a Task from a user who had logged hours against the Task, the hours will not be lost or removed from the project history. The user will simply not be able to see that Task anymore. View permission can be revoked and granted at any time, and this feature is availble for all Daptiv records, including Documents, Issues, and Dynamic Application records.
A common use of this function is restricting documents that contain sensitive information, such as contract or budget details, from anyone on the project who doesn't need access to that information. This allows the PM to keep all project documents in the same place without having to keep these private documents offline or in another resource inaccessible to general users.