The subdomains rule allows you to restrict the subdomains on which you want the widget to show up. You can choose whether you want to specify the subdomains where the widget should show up or the ones where it should not. This comes in very handy if you have different parts of your business on different subdomains. For example:
www.site.com - Your main site blog.site.com - Your blog shop.site.com - Your storefront
So if you want a widget to only show up on your blog you should specify the blog subdomain in the rules set.
Note that you should only include the subdomain itself (blog), without the primary domain part (.site.com).