In the edit dialog the only required field is the tab heading. You can safely ignore the rest of the edit dialog until you need to do more advanced stuff. Place one Magic Tabs block where you want a set of tabs to start, then further Magic Tabs blocks for each tab. You can place any block or stack between Magic Tabs blocks to provide the content of each tab. A set of tabs needs at least two Magic Tabs blocks.
Here is a simple example of sequence of blocks within an area. You can have other blocks before and after, but this sequence of wrapping what you want within each tab with Magic Tabs blocks is the essential part:
The above will then show as a Tabs A, B and C. Clicking each will show the associated tab content.
The 'Magic Tabs End' block is optional, if you leave it out, the tab set will run on to the end of the area.
Some important points to bear in mind:
If you add a Magic Tabs block and save the page in a state that does not comply with these points, you may get unexpected results.