This is related to helper addresses. With those, you can specify a particular host or an entire subnet as a target. If you elect to forward to the entire subnet, you need to enable 'ip directed-broadcast' on the target subnet ethernet interface. They are by default not allowed because of DoS concerns.
To answer a little more directly, this has no impact on the *routing* of udp packets. Just affects what happens when certain types of relayed broacasts are received on an interface.
To elaborate on the possibilities, there are cases where no ip directed broadcast on a LAN can impact the receipt of an UDP-based application. I have seen some legacy "ticker-type" applications (UDP-based) that rely on the IP directed broadcast feature to broadcast UDP packets to clients on selected subnets.
For example, a "ticker-type" application server may have a list of subnets such as 10.1.1.0/24 and 10.1.2.0/24 where the clients of the application reside. It sends ticker updates to 10.1.1.255 and 10.1.2.255. If IP directed broadcast is not enabled on the interfaces hosting these subnets, the ticker clients will not receive the traffic from the application.
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