A book is simply a bunch of "nodes" in a treeview (also known as outline).
A "node" is a page, a topic, an issue, whatever content you create here at this website is a "node" or derived from the node class.
So... a book consists of a treeview of content pages, and those content pages can have child-pages, and so on. Almost everything can be put in a book: if there is an interesting forum topic you can put it in a book, if that is relevant for the book.
Whenever you view a "node", if that "node" happens to be in a book, you get to see the book outline in the Left sidebar. As a result, you get to see a list of other "nodes" that are relevant to the current node since they are in the same book.