It works for me.
It is only meant to hide the channel key from the titlebar.
The titlebar is the bar right at the top of the screen with the channel topic and so on inside it.
If I set the channel #chatflat +k with the key "test" then it should show the key in the titlebar.
When the option is enabled though the key doesn't show up (e.g. the word 'test' disappears from the titlebar).
This option will also hide the channel key from the Channel Central dialog. Type /channel in a channel, and, even if you're opped, if +k is set the key will be covered with ***s.
If this isn't working, then it's probably due to some script playing with the titlebar. Type /remote off then disable and enable the option again, see if it works.
G'luck!
Regards,
