first bit basically is for what side of the channel the channel_update is for (since each side of the channel can have node-specific routing configurations). Second bit is for signalling that the channel is to be disabled.
@jb55 Great, thanks for both the help and the resource. I was on c-lightning's github which didn't have all than info. I will get digging now :)
@cryptonomicon yeah I had to look the the source to figure it out