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If you specify the Remote X509 CN field, OpenVPN will check the Common Name of the Subject of the remote peer. For host certificates the common name of the subject is the FQDN hostname.
If you omit this field, the only condition needed to establish the VPN is that the remote certificate has been signed by a trusted certification authority. In other words, by specifying the Remote X.509 CN you increase the security of the VPN.