The functions vary a little from manufacturer to manufacture but the basic idea is to stop a valet who is say parking your car up trying to drive it as though it was a Ferrari. e.g. limits engine revs. It therefore needs to be easy to find in the control menu.
It allows you to put a password in and disables everything except doors for when you give your keys at hotel for someone to park car, the touchscreen is off and they can't access the boot. You then select it again put in the password and everything works again. It prevents someone getting access to addresses in the sat nav and phone numbers, not too sure about not getting access to the boot as I assume you can still fold down the seats from inside the car.