It basically tells you all the factory info about a car and is used to find parts for that specific car (ie r33 gtst series 1 would have some different part numbers for some parts compared to a r33gtst series 2.
You can run your vin through the nissan fast software and it will tell you the model code that you can decode to find out all the extras your vehicle came with. It will tell you the year of production, the colour it came from the factory as, engine, transmission, if its a vspec or not.
An example. You are looking for say a r32 gtr and find a nice one that is claimed to be a 93 vspec. Looks like it has factory paint and its in good nick.
Say you run the vin through the nissan fast software and find out its not actually a 93 model vspec. Its just a normal gtr with a sticker and its been re-painted since factory but is being claimed to be a standard well looked after vspec. You can now go back to the dealer and say they are basically full of shit and that you checked out all the vehices info and it doesnt add up. So instead of thinking you have just bought a nice 32 vspec for an alright price you were lucky and dodged buying an over priced stock 32 gtr that could well be pretty dodgey.