This dialog allows you to manage large lists of open windows by assigning them into groups. Lets say you have eight windows open, but want to close four of them scattered through the list.
Select the windows you want to close, hold Ctrl key to select more than one at a time.
Click the button that says Close Window(s).
Just those four will be closed, leaving the other four files or captures available for editing.
You can use this process to switch to the checked window on a list by hitting Activate (or "bring up" from an icon multiple windows), you can use this to Cascade only the selected windows, or perform any of the listed functions on just the windows you wish to manage.