The Pagetitle is the text that is shown in the title bar of your internet browser, and on search results for each page on the wiki.
Your page rank in search results is partly based on what is in the title bar at the top of the page. Search for your wiki's topic on Google, and you'll see that the top ten results almost always have certain words in the page title. You want to include those words in your wiki's pagetitle.
The $1 in the regular page title inserts the pagename of each page automatically. Because the main page is usually either called "Main Page" or SITENAME, it is redundant to include it in the title.
We recommend that you customize this feature with some additional text after the sitename, both to help users find your wiki with commonly searched terms and to give more descriptive and memorable text to the browser window and bookmark links.
What to say
The page title should describe the site well. If your site has a name based on inside fan-knowledge of the subject, eg. "Memory Alpha", it helps to say "Memory Alpha - Star Trek Wiki" so somebody who does not know the project name will still find it.
On the other hand, if your wiki already has a content based name, eg. "Marvel Movies Wiki", then you may wish to add some other key terms from the content. So you might choose "Marvel Movies Wiki - Wolverine, Iron Man 2, Thor", as seen here on the Viper page from that wiki.