Yes you are right when you comment it out by default it is set to "None" and also when you change it some other value httpd service should start fine. You just need to comment out two lines and add one line for "PHDSOutputProtection". It should like as below:
Options -Indexes FollowSymLinks
# Uncomment the following directives to enable encryption
# for this location.
In this case it uses following policy file : "<FMS_install_dir>\phds\static\phds-OPRequired.pol".