"head position" refers to your head position relative to the cockpit and can be changed using page up/down and arrow keys.
"save head position" refers to your default head position in different views. For example, checking 6 on the p51d mustang-to get a clear view behind you every time you look back you have to manually press side on the arrow keys. However, if you press side on the arrow keys so it is in a good 6 view, then save head position, every time you look back it will now be in the position your save.