This is identical to the description from the 1.1.110 version of the documentation, and it seems to be more relevant to game version 1.1. The "zoom-to-world" view has been reimplemented as Remote View in 2.0.spectator :: Read|Write boolean
If true, zoom-to-world noise effect will be disabled and environmental sounds will be based on zoom-to-world view instead of position of player's character.
I am not convinced that the spectator property currently does anything, and I considered making this a Bug Report. In particular, it has no bearing on whether the player is in Spectator mode, i.e. whether their controller_type is set to defines.controllers.spectator.
It always reads as false in my testing and I don't know what situation would cause it to read true.
Even if I'm wrong about all of this, the description is quite confusing/misleading, and I would like it to be clarified or removed if applicable.