And yes, like Hass says, you pay the settler. It's a short-cut, so that you can take radiant quests - and not have to do them. Victory!
To be honest, I'm thankful for this option. I couldn't be arsed to go and wipe out another generic hive of raiders. I do those radiant missions to get rid of them from my quest list more than anything. And annoyingly enough, I get more of them every time I visit the Castle/talk to Preston Gravy.
That's why I only once asked for a radiant quest from BoS, they are boring and... radiant, as in, generic.
I know, I will simply avoid the stupid quests
Here's a tip I came across though - when you report back to Preston - as soon as he says "I have something else for you", run for your life, litterally. This will complete the previous quest, without starting a new one. Make sure you don't run into walls and stuff ;D (there are some times I have to try several times, because I back myself up into walls, fail at escaping him, and he pins more quests on me. You need a bit of a distance from him, before he stops addressing you. There's a bit of fine timing to it, but you gotta let him START describing the next quest, even if it seems counter-intuitive - then just run for it!)
This won't work if you are told to report to him for another quest, because he will then start by giving you a quest, for then to allow you to report back to him. I got 4 quests from him one time, simply by trying to report back
But yeah, if you only want to finish a quest HE gave you, then it'll work - approach him - report back - run!
I once got a minutemen quest while I was exploring the random wilderness. I'm almost certain this has to do with me escaping one such dialog from a settler wanting me to resque a kidnapped person. I backed out of the dialog, ran off, and somehow this "lingered" in the system, untill the quest was suddenly forced on me hours later, while I was miles away.
Once it was, it was broken, and there were no quest-markers to follow, and eventually I was able to report my failure back to Preston, and have the quest removed from the list.
They truly are annoying these radiant quests...