I haven't used it for a while either, but I'm pretty sure that "bury" kills stories off completely. From their FAQ (http://about.digg.com/how):
Bury. If you find stories with bad links, off-topic content,
or duplicate entries, click “Bury.” That’s how we get the
spam out of the system and let the good stuff rise to the top.
Other than that, they're pretty sketchy on what exactly it does.
