How do I configure a global hotkey for iTerm 2?
You're in the wrong preferences. That's the Appearance settings, available with ⌘I or the Appearance tab in the app Preferences (⌘,). You should be in iTerm → Preferences (⌘,) to access the app preferences, then select Keys in the toolbar at the top.
Specifically:
On updated versions you will see... Create a Dedicated Hotkey Window...
