Reset puts the show into its default state i.e. all the shows channels will be set to their default state and any audio or video will be stopped.
The Reset state is the state the show is in before the Pre-Show and/or Start of the show.
Your show always has to be reset before you Start it again, or after you Cancel your show.
Setup mode is not available while the Pre-show or show is live. The show has to be Reset before you can access the Setup mode.
To understand how Reset fits into the show, see Show Lifecycle