What version has this? I just tried 12, 13 and 14 (Canary) and I don't have that option. I have "Tab Overview" as the first thing in flags. Is this a Windows only thing, perhaps?
This let me start chrome with the "-enable-vertical-tabs" command line switch. Once it was started I needed to right click a tab and choose "Use Side Tabs".
Probably worth noting that the vertical tab UI you end up with looks pretty weird (on Mac OS, at least), as it's literally just moving the existing tabs over to the side without changing the graphics at all.