The visual bell in iTerm is implemented as a bell icon, not as a
screen flash as in the Mac OS X Terminal.app. So it's likely that
whatever you are experiencing is a result of whatever terminal program
you are using, not iTerm.
If you are referring to the bell icon, you can turn it off with the
"Flash visual bell" option in the profiles part of the preferences.
"Silence bell" refers to the audible bell.
Aaron Meurer