O365 SSPR require users to register when signing in

It's pretty much explained in the quoted text above. If you enable SSPR registration, users will be prompted to register their methods during login. Much like the MFA registration process works. If you do not configure/force registration, they can still go to the MyAccount page and configure methods therein. The obvious downside is that you have to rely on the user itself to do the registration, and potential scenarios where they end up needing to reset their password without any recovery methods configured.