Well, it told you wrong. DNS stands for Domain Name Service. Basically, it is used by computers connected to the internet in order to translate names into IP addresses. All comms on the net is between IP addresses, and the names are added more for the convenience of humans (especially with IPv6).
An excellent resource on DNS is
http://www.zytrax.com/books/dns/ It explains in reasonable details the basics of how it all works, and takes you through configuring bind with plenty of examples including delegating nameservice to other servers and setting up master / slave servers for redundancy.
