I don’t have a complete understanding of how this exit works.

The default Parameters are:
8.00 Profit Percent
2.00 Stop Percent
4.00 Trail Stop Trigger Percent
40.00 Trail Stop Percent

The 8% Profit Percent is obvious enough. I assume the 2% Stop Percent limits the maximum loss from the position at 2% and kicks in before the 4% trailing stop loss takes effect. I read the description of the 40% Trail Stop Percent and I still have no grasp of how this works.

I assume that Fidelity will take a trade like this from Wealth-Lab. I don’t see how I could encompass all these factors in a trade from Active Trader Pro.

The Trailing stop kicks in when profit achieves 4%. The price of the trailing stop is 40% below the maximum profit level. Since I'm not familiar with the Strategies rules that you're talking about, I'm not sure if the max profit is determined by MFE or the close.

See SellAtAutoTrailingStop for an illustration and example. With respect to your example, 4% and 40% are the triggerPct and profitReversalPct parameters, respectively.

QUOTE:
I don’t see how I could encompass all these factors in a trade from Active Trader Pro.

What does ATP have to do with it?

ATP doesn't have anything to do with it. I just mentioned it because that’s what I’ve been using.

WLP5 is completely independent from ATP. You can create strategies and trade them using WLP alone.