The description is that you can specify sitewide setup on-the-fly to handle big communities or large web service.
An E-learning system in a university for example, you can add the realm College where you can specify specific modules to be turned ON/OFF, under that you can specify the realm for Department where you can specify the modules to be turned ON/OFF ... so on until you reach the realm Section of courses with their specific modules also.
Realm --> SubRealm --> Sub_of_SubRealm
On each realm, you can specify the specific modules to be turned ON/OFF with their corresponding permissions (Public, Private, Shared by specific Realm, etc.).
With this capability, you can easily setup an extensive online community. The multisites module is quite different because it focuses on the domain names. How about if you want to setup a large CMS, all of the sub categories existing in a single portal.
Please tell me if this is a concern of the Core development team else I'll be making my own module for this.
Been here since the 1st mutant. Cheers.