I think you are talking about auditing a class. As far as selection is concerned, the Navy does care about Withdrawals, and bad grades, obviously. Auditing is a sneaky way to get around withdrawing from a class, and doesn't look as bad as withdrawing. Any pattern of auditing classes can be recognized, and probably would be frowned upon.
If you are auditing this class for any purpose other than avoiding a bad grade, I would write an explanation for it and submit it inside your application.
I.e.- I audited this basketweaving class because basketweaving has always been an extracuricular passion of mine, of which I wanted to pursue with no obligation to attend and perform.
Hope this was on the right track with your question.