What do I do with the dowloaded file(s)?
Go to Letterboxd Importer, log in to your Letterboxd account if you haven't already and select the CSV file you just downloaded (the one with the watched films). Here double check the movies which reported errors in the exporting process, if there were any, then follow the instructions on the page. To import to the watchlist go to your watchlist (on the browser!) and select "Import films to watchlist...", then select the downloaded CSV file with your 'want' (to import to a custom list the process is similar). Again, double check the movies which reported errors in the exporting process, if there were any.
What do "log movies" and "add to diary" mean?
In Letterboxd, to "log a movie" means specifying a watched date for the movie, adding it to your diary, and recording your viewing in the activity feed (visible to friends and other users). The only differences with just marking a movie as watched is that you could have watched it at any time. But then, why not add every film to the diary? Because Must doesn't really have a watched date, it saves only the "last modified" date, which corresponds to the last time you changed the rating or review of a movie, otherwise it is when you marked it as watched. This means these dates could be very inaccurate, especially if you tend to change your ratings or reviews often. This is why I decided to let you choose based on your preferences. If you don't care at all about the diary you can just select "Don't add to diary". You can still change or remove these dates later on Letterboxd, so if you're in doubt just leave the option on "Log all movies".