As far as I know, it's just on-computer credentials storage so you don't have to remember your passwords. — there are other such systems for other platforms (KWallet for KDE, for instance). I could be missing some more details, though.
It's basically a secure one password system for all passwords, it's supposed to make things easier. I haven't bothered with it since I first tried it when OS9 was brought out back in the late ninties. I wasn't even aware that OSX still bothered including it.
