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There isn't really much to say about this one. Yes, it's another cache. This one uses a chunk of memory to hold your program icons. When Windows starts, it builds a cache of icons in memory, and whatever icons it can't fit into it's memory cache get tossed into a file on the hard drive called "ShellIconCache", which operates somewhat like a miniature version of the swap file. Since memory is faster than the hard drive, you'd generally prefer to see the icon cache in memory.
On the other hand, if you have a computer without alot of memory, it might be a bit wasteful to eat up memory space with icons. In that case, you'd be better off setting a low icon cache size to keep the memory free for something else.