The setting of a psalm is most definitely referring to the Scottish Hymbook's metrical psalms.
These are versions of the Biblical psalms found in the Old Testament. They were written at the time of the Reformation, keep to a strict metre (in the poetic sense) within the same psalm and often rhyme. Each has it own melodic tune - no chanting allowed in the Kirk.
I am not sure what the Presbyterian church of Scotland does these days, but in my school-days both metrical psalms one or two of them, and four or five hymns - not based on biblical texts were sung at all church services.
Some psalms, notably the 23rd have more than one well-loved tune - as far as I remember, the Queen Mother preferred the other tune, which I cannot remember the name of to Crimond.