For example, here's how an author inserts an exercise into a lesson:
Here's what students see:
Skilling drops the exercise into the lesson. It's seamless for the student.
OK, why doesn't the author just type the exercise into the lesson? Why make the exercise separately, and then insert it?
When it's a separate object, the exercise can be used in the grading interface, in the student's timeline (think of a stretched out calendar), in reports, and much else. If the exercise was just text typed directly into a lesson, it would be hard to extract and use in, say, course assessment reports.
There are many different types of learning objects. In fact, you're one of them.
Yes, you. You're a "character." You're handy for worked examples, asking questions, setting social norms... you're quite useful.
Authors can make as many different characters as they want. Then they use the character tag to add you to lessons.