This UI is a control interface for AVD command-line tool and is developed to support future versions of it (without need of changing UI itself). Future versions of AVD tool may have different options so UI for these options are constructed automatically every time AVD settings is shown. And since there is no possibility to know how these options are related to each other there are checkboxes (every option could be simply in ON or OFF state) and simple validation algorithm which checks if all the options are correct and shows an error message if they're not (it actually runs the command-line tool, checks if there are errors and shows the output in the UI).
As a result: it may looks like a bad UX solution (and, frankly speaking, it is) but it seems like it's done by the reason I tried to explain above.