What type of in-game harassment does this prevent? Does it make sure you don't play against the same killer who can tunnel you or something? If so, how long does it keep you separated from players that you played with?
Yeah, there is nothing in the game to prevent that.
Streamsnipers who queue at the exact same time as a streamer in the hopes of ruining their game. This is, functionally, a redundant system since the streamers who'd get targeted now get a Preferred Player Premium Queue (TM).
It's for streamers, so stream snipers can't try to queue into the streamers lobby by timing their ready up, or tell if they're in a streamers lobby by matching the time they ready up.
So if I have this turned on, it is entirely possible that I will end up in back to back matches against the same player playing the killer role?
No more or less likely than without it... but yes entirely possible.