Well. Okay. I'm not sure how to succinctly describe it, aside from saying that It is a way to group related tool palettes together for easier access and navigation amongst palettes. :-/
From there, all you have to do is name your group and drag the appropriate palettes into it.
TPNAVIGATE is a command which will bring up a specified tool palette or tool palette group (and if the tool palettes are closed, this will bring them up and navigate to the appropriate one).I don't believe there is a concise definition here, but, if you'd like to explore the uses and methods of tool palette groups, check out the AutoCAD help file for more details on various topics.