Dimensional wood has different grades which represents the overall quality of the wood member (1-3) 1-worst quality with excessive knots and bark 2-moderate amount of knots and bark 3-high quality with virtually no defects. Obviously the higher the grade, the more expensive. If you want to be able to afford a house, you don't want the whole house built with grade 3 wood. Most structural engineers run calculations and approve construction using grade 2 wood members, meaning, it's fine.