I don't see it documented in the help file. I was hoping it would pass the maya transform of a Houdini object into a second Houdini object if it's used as an input. However as soon as I turn it on it sets all transforms to 0 and locks all the transforms on my Houdini object so I can't move it anyway.

“Use Asset Object Transform” is probably only useful when the asset is an Object asset. An Object asset has its own world transform, which isn't exported to Maya by default. Enabling that option will export the Object transform into Maya.

In the case of a SOP asset, Houdini Engine creates a dummy Object node, and puts the SOP asset inside. However, this Object node is always at identity. So when this transform is exported to Maya, the asset looks like it's always at zero.