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Yes ..I just tested it after reading your posting with these steps.
1. I was in the game with carbonite active. I "ticked" the option and disabled carbonite. I then logged out.
2. I logged back in without carbonite active. The "ticked" checkbox was saved and still ticked.
3. I enabled carbonite again and logged back out.
4. I logged back in with carbonite active, and the checkbox was unticked again.
To clarify, the checkbox in question can be found by hitting "ESC" then choosing "Interface". Then choose "Objectives!" and it's the checkbox option that reads: Automatic Quest Progress Updates
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