So, there’s two aiming options, iron sights and HUD crosshairs. As I recollect firing the M203 the iron sights had meters running up its side—thus you elevated the barrel to coincide the estimated range out to 300 meters.
The HUD with cross-hatches is probably some type of elevation/relative size of target (like a LAW anti tank rocket?), using whatever hatch mark that’s relatively the same size (across) as the target. The lowest hatch marks are the smallest and would be used for distant target thus pointing the barrel up to lob the round a great distance.
I’m guessing…as I’m not near my computer to test this out.