No previous preparation is needed. Batch conversion is not performed based on open layers but performed directly on files, so there is no need to open layers in QGIS before converting them.

The conversion is performed by an algorithm from the QGIS Processing framework. Processing algorithms can be run either as individual algorithms or, in this case, in a batch process.

Outputs of Processing algorithms can be created in all formats supported by QGIS. The format is selected using the corresponding extension in the filename and, unlike in the case of saving a single layer, does not have to be selected in a field or list. Using geojson as the extension for your output files, you tell processing that you want to generate a file in this format.

Although the algorithm saves only the selected features of the layer, if there is no selection, it will use all the layer features. This is the default behavior of all algorithms in processing. As there is no selection in the layers that you have converted, all of their features will have been used.

When converting files this way, the additional options from the Save as dialog are not available, and the default configuration values are used.

You can also convert vector layers with another more complex algorithm from the Processing Toolbox menu, which allows you to enter the configuration parameters used by the underlying OGR library that takes care of the process. It's called Export vector. Find it in the toolbox, right-click on it, and select Execute as batch process:

In this case, the output format is not controlled by the extension of the output filename as it happens with other processing algorithms according to what has been already explained.