Marathon settings are (normally) factory default where you earn extra lives every x amount of points, etc and whatever standard difficulty is (generally). For tournaments, this was not necessarily a good setting as the players were able to sit on the games for a significant period of time so the tournament settings were created by TG as a way to increase the difficulty of the game to minimize the length of game, for instance, setting a max # of lives with no extras, or raising the difficulty level to its highest dip setting, etc.
I tend to personally like the tournament settings because I dislike longplay games and the prospect of playing something like Galaga for 12+ hours does not appeal to me, but it would for 4 hours.
Current tournaments like the one Mark Alpiger runs for his site classicarcadegaming.com alleviate this prospect by setting all the games to factory default but timing all games to exactly one hour maximum. This also makes for some fun moments because you have some time right at the end where you can employ some strategy, for instance dying and replaying the Steve Perry board in Journey to maximize points at the end of your hour.