If the consensus sequence of an isolate has ambiguous positions in the sequence (e.g. Y, R, K...) perhaps as a result of inter-operon variability in the 16S, each ambiguous position will be counted as a mismatch by BLAST. However, setting the search flag "IUPAC aware" means that no mismatch will be recorded IF the reference sequence contains one of the nucleotide codes which is valid for the IUPAC code present in your sample sequence at that position. IUPAC aware searches take longer to run, due to increased computation of permutations.