yes increasing the voltage WILL effect the system. I'm pretty sure the thing you are referring to is the voltage regulator depending on what country you are from. In the US we use 110Volts through our socket whereas europe has like 220V.....both of those numbers are probably wrong but I'm just saying Europes voltage through the sockets is like twice ours, so when in europe you have to flip that switch so your PSU can accomedate for the correct power running through it.
EDIT: Probably why you won't find any computer websites in the US that sell to the UK or places like that...because they know too many people would forget about that little switch and fux up their comp