It's exactly what Wims said. var %dest $iif($prop == chan,#,$nick) means exactly:
if ($prop == chan) { var %dest # }
else { var %dest $nick }
;Further explained: $prop is the value you enter ($silence().PROP) If the prop is chan (if the CONDITION is true), use the true value "#", if the prop isn't chan, use the false value "$nick".
As to why $iif is used. It makes it simnpler and nicer to look at, and faster to type.