By default, an MSI-based setup will appear in Add/Remove Programs when it is installed on a system. The ARPSYSTEMCOMPONENT property can be used to hide the default Add/Remove Programs entry so that you can mark your MSI as a system component or create a separate entry that points to a wrapper setup.exe.
There are several factors to weigh before deciding to use this property in an MSI-based setup. A while back, I linked to a couple of blog posts written by Heath Stewart about design considerations to keep in mind if you decide to use the ARPSYSTEMCOMPONENT property in an MSI-based setup.
I just noticed that Heath has posted a blog article where he links to several additional posts he has written about the ARPSYSTEMCOMPONENT property. He covers topics including reasons for using this property, logistical considerations when implementing a setup that uses it, the dangers of using it, and some implications it has for patching/servicing. I encourage you to check out this article if you are using or thinking of using this property in your MSI-based setup.