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I assume you are asking about Control Panel >> System Admin >> Preferences >> General Settings >> Module-wide Cache.
As far as I can determine, if one of the modules is set to "No Cache", then that setting will
not override the cache settings for individual blocks. The individual block cache settings will be used (Control Panel >> System Admin >> Blocks >> Edit > Cache lifetime).
If a module-wide cache is set to something
other than "No Cache", such as "5 minutes", then that setting will be used for all blocks within that module, regardless of the individual block cache settings.
This is handled in header.php:
if (xoops_getenv('REQUEST_METHOD') != 'POST' && !empty($xoopsModule) && !empty($xoopsConfig['module_cache'][$xoopsModule->getVar('mid')])) {
...
I think the option "No Cache" is misleading here, and should be changed to "No Override".
Please correct me if I'm wrong about this.