Wouldn't using a generic label such as "simple" leave the user just as uninformed about what is, and what is not, being installed in the system? I would argue this is even more damaging, since the user wouldn't have the chance to take it upon themselves to research about it.
Keep in mind that in order to get to that prompt, the user must click on a button that is labeled as "Advanced features". It's quite reasonable to expect certain degree of familiarity with the terminology involved, what it means, what other options are there, etc.
I don't see how it would be helpful to try and fit all the complicated intricacies about filesystems in the installation prompt. If the user is unsure, they use the pre-selected defaults. If they're curious, they can browse online to get some answers. And if they're feeling adventurous, they can proceed at their own risk.
The reason is security. If the default minimum were 4 characters, that's what most people would use since very few actually change the defaults at all.
You can still change these rules afterwards, however there's a hard coded minimum of 6 characters. The only way to work around that is to set an initial password during the installation process when these rules are not enforced.
To change this, you need to edit a system configuration file, so you will need elevated privileges, located at /etc/security/pwquality.conf.
You'll need to update the line that says minlen to whatever minimum length you want, and remove the preceding # symbol:
