Nothing needs to be removed, rather, you should add the code above to the ISPConfig 2's "Apache Directives (Optional):" textbox on a site's definition.
WebDAV is fast, but note that it does have different file permissions then FTP. Uploading a file via WebDAV may prevent that file from executing with read/write proper privileges (i.e. having wordpress install plugins, etc.). A faster alternative to FTP and WebDAV is to use SSH as file system. If you are on a mac, using MacFUSE is ideal.