SSPR will allow a user who has never set a password on their account to set their first password. It does this by using the configured LDAP proxy account to set the initial password provided by the user.
A user would either go through the New User registration if there is no existing ldap account, or the User Activation section if there is an account but they do not have the password for it. A user would not typically ever use both functions.
If a token send method is configured for either new user registration or account activation, the user must receive and enter that token value before that process can be completed.
Hope this helps.