[firewalz]

Ill give it a shot:
If a client on the Public internet outside is connecting to a public nated address of an Internal server.

client(64.23.19.10) ==> server(pub=63.12.45.62) (private=192.168.2.1)

If nating was done on the server side, post kernel, than the OS would try to route the packet based on the servers public ip 63.12.45.62 and route it back out the external interface.
To fix this you would have to add a static route pointing the servers public address to the internal gateway. (route add 63.12.45.62 192.168.2.x)

"Translate Destination on client side" nats the destination servers ip pre kernel, so the OS makes a routing decision based upon the servers private ip which is on a directly connected interface.

I hope this make it clear?