Local URL Item Type Metadata for Website Item

I have a quick question regarding the "Local Url" Item Type metadata for the "Website" Item type. Under the description of it, it says the Local URL is "The URL of the local directory containing all assets of the website." I was wondering what exactly this means. So far we have been just dumping in the URL into this category, but according to the description it seems to do more. I am particularly drawing attention to the "all the assets of the website" section of the description. Does this mean that we can save the entire website as a document and upload it to this section? Basically my question is does this description for the "Local URL" mean that we can do more than merely insert URL of the website we are adding to our site? And if it does, what exactly does it mean? How much more can we do with this section?