The menu items apply to the video modes, not line counts, hence the usage of 240, 480, etc.
Line count is not the same thing. Depending on the console and the video signal it outputs, “240p” could end up being 261, 262, or 263 lines. Knowing line count can be useful for debugging display issues, though I agree that it’s of limited use to most OSSC owners. Now, why, precisely, the display defaults to this over the display mode is certainly a valid question, but I think only marqs can answer it with any authority.
I’m not sure what kind of configuration your OSSC had, or which firmware you upgraded from, but my 1.6 unit came with 0.78, and it always defaulted to showing the line count.