The documentation for wireless configuration say that the 'auto' settings for the 'channel' option "defaults to the lowest available channel".
I am not exactly sure what this means. What does 'available' mean? Could someone explain this to me? Thank you!
In my limited[1] testing, I haven't actually observed it to always use the lowest available channel (at least not in the 5 GHz band), so I'll comment on the definition of 'available' only.
In the 2.4 GHz band, the situation is rather simple. Pretty much all wireless hardware supports channel 1-14, regulatory domain settings typically restrict this to either channel 1-11 or 1-13 (channel 14 is exclusively allowed in Japan and only for 802.11b/ DSSS modulation, as in <=11 MBit/s only, accordingly this isn't actually relevant anymore). Under this definition only channels 1-11 or 1-13 are 'available'. Regdom hints from nearby APs (IEEE 802.11d) can also disable channel 12 and 13 dynamically[2].
For the 5 GHz band, the situation becomes a lot more complex. While you have similar static regdom restrictions as in the 2.4 GHz band, DFS requirements also add in a dynamic element. This means the number of channels changes at runtime, depending on the activity of radar stations (or what's perceived as radar) in your area. Immediately after starting up, only the non-DFS channels can be considered as 'available', the DFS channels only become available after the AP has scanned (passively) and listened into them for a specified amount of time, to rule out any radar related interference. Even if an AP has originally chosen a free DFS channel, it might later become unavailable if radar pulses are detected. In this case the AP must immediately vacate the used channel and switch operations (and indirectly the connected clients) to a free channel.
[1] without a means to prefer (respectively to blacklist-) some channels over others, 'auto' isn't really useful to me personally, as transmit power varies significantly between the different sub frequency ranges in the 5 GHz band, furthermore not all of my clients can tune into all of the allowed 5 GHz channels my AP can use.
[2] as in, your hardware supports channels 12/ 13, your region (and regdom settings) allow you to use channel 12/ 13, but the AP you're connecting to sends out IEEE 802.11d (perhaps erroneously) regdom hints disallowing access to these channels.