#INSERT_HEAD_CSS indicates where installed and activated plugins will insert their stylesheets into the generated HTML files.
The template files can overload these stylesheets depending on the order that they are referenced in the template files. Remember that if two or more styling rules with the same "weight" exist for a given element, then the last declared rule will take precedence. This means that if your template file wishes to override a "standard" CSS rule, then it will need to define that particular template-specific rule AFTER the reference to
Note that in order to maintain compatibility with existing template files, if the
#INSERT_HEAD_CSS does not exist within a given template file, then #INSERT_HEAD will insert its stylesheet contents instead (and do note that the order of insertion, being somewhat random in this case, may not always be the most optimal).