You can kind of see this in action on Discourse itself. Whilst most notification level descriptions have been written to (sort of) cover both and therefore are quite confusion, the muted one is clearly inapplicable.
For a private message is says:
However, “it will not appear in latest” doesn’t make any sense, since private messages never appear in the latest topic list…
The problems are more severe with properly customised descriptions of private messages vs categories…