The train limit is how many trains can reserve usage of the station. So a limit of 2 means that one train can be in the station and unloading, while a second train is waiting to go into the station. Typically, a train will get as close as it can to the station to wait.
A limit of 1 train means only one train can be going to and using the station at a time.
A train limit applies to the red station building, not the name of the station. So if you have 5 stations named "Station 1" with a limit of 1, that means 5 trains can reserve each one of the stations named "Station 1".
A train limit of 0 means no train can reserve the station and is normally dynamically set using circuits. It can be used to tell a train not to deliver materials to that station because the buffers are full.
The wait time is how long a train will wait at the station before flagging as true. If you have no other conditions on the schedule, the train will leave the station immediately after the time has passed. So, if you have a wait time of 30 seconds, it will stay at rhe station for 30 second and then leave, regardless if inserters are adding or removing materials.
Another is "inactivity" which is like wait time but it starts a countdown after inserters stop adding or removing materials from the train. So an inactivity time of 5 seconds at a loading station will start counting down once your inserters stop adding materials, and when 5 seconds pass, it will flag as true and the train will leave.