If you were watching America's Talent and heard Simon Cowell say this and you were puzzled, this is something he says sometimes to screw with the performer/performers and scare them, and he is technically telling the truth because he did not simply like the performance, he LOVED it.
Said when letting an individual do him/her, when you either aren't in the mood to criticize them, or feel it's not your place to, whether or not you agree with their behavior. Because hey, what they eat doesn't make you sh*t, why give yourself gray hairs tryna change 'em?
If you like it, I love it...they're your kids, not mine.
Me: Wow, your girl wears a mad lot of makeup!
He: Hey, as long as the p*ssy and money don't stop, I say to her "if you like it, I love it."
Whatever floats your boat, if you like it, I love it.