[mistwang]

1. I wonder what is: Max I/O Buffer Size is this RAM memory that litespeed can use to handle big files? So, if the limit is reached then litespeed will begin to dump in TMP directory and use it as RAM I guess?

Yes,

2. What will later clean Swapping Directory ? how can I speed up cleaning TMP directory and is it recommended?

You do not need to. It should not have big impact on performance, and LSWS will avoid using it whenever possible.

3. My server must handle large file uploads (650mb) what would you recommend? should I increase Max I/O Buffer Size or increase TMP directory size?

Handling upload of 650mb file via HTTP then processing with PHP is not recommended. It is not efficient with too much overhead, better use FTP for file that big. If you have a few concurrent uploads, your server might be overloaded.