The targeting setting determines if an ad group must serve ads only to users in the associated audiences (Target and Bid option) or to all users (Bid only option).
It is not logically possible for an ad group to be associated with one audience using the Target and Bid option and another using the Bid only option. Hence, the system enforces the same targeting setting across all the associations for a given ad group. This means if your ad group is associated with multiple types of audiences (remarketing and in-market), all of those audiences will have the same targeting setting.
While the status and bid adjustments of associations can be edited in bulk by selecting associations and clicking Edit on the Audience tab, the targeting setting cannot. The targeting setting can only be edited one ad group at a time from the Audience tab by clicking on Create association and then selecting the relevant ad group. Any update made to the targeting setting for an ad group is applied to all the existing and new associations for all audience types for that ad group.