v2rayN's tray menu offers several proxy modes with easily confused names. The difference is “whose traffic gets captured, and how”.

System proxy (auto-configure)

Points Windows' system HTTP/HTTPS proxy at v2rayN. Only programs that honour the system proxy (browsers, most networked apps) go through it, with routing rules splitting traffic. This is the everyday default.

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PAC mode

A PAC script tells the system which URLs to proxy and which to send direct. Routing rules are more powerful now, so PAC is rarely used on its own.

Global vs split routing

“Global” sends all system-proxied traffic to the proxy server with no domestic/foreign split; routing's “split” sends domestic direct and foreign via proxy. That's not about capture scope but about routing rules.

TUN mode

TUN (a virtual adapter) captures the whole system's traffic, including command-line tools, games and background programs that ignore the system proxy. See TUN mode explained. The cost is that it needs administrator rights.

For ordinary browsing, “system proxy + split routing” is enough. Only reach for TUN when a program stubbornly refuses to use the proxy.