To set the properties right, you first need to select the "main object" that will be the "center of the LOD", so the object that will be close to that object will stay the same, and the far objects will be decimate (with the decimate modifier).

In the "Max decimate" properties, fill in the maximum decimate value that you want, keep in mind that lower value will give you more decimate.

The "Steps" property set the "jumps" of the decimate (so the modifier will not update every time the main object move), lower value will give you more jumps (the objects will updates more, can be slower on big scene.

For the "LOD range", you need to enter the minimum distance from which it will start to decimate, and the maximum distance from where it will receive the maximum distance ratio.
To easily calculate the desired distance, you can go to the top view, and count the cubes that are from the main object to where you want, or use the measuring tool to calculate the distance.

In the example below you can see how to use it, and you can see the memory go down after you run the addon