The occurrence records in the Atlas are points. Admitted, the accuracy of the location can often mean that the species was seen within a defined area, but the Atlas can only treat it primarily as a point, with an uncertainty radius if that information is available (see coordinateUncertaintyInMeters). There are three other types of species data (checklist areas, expert distribution polygons and prediction areas) but these are special cases.

Points to grid transforms point occurrence data into a sites by species data matrix. This form of data allows you to compare areas by their species composition. Sites in this tool mean grid squares. The output from the tool is therefore a matrix of user-defined sized grid cells by species. Usually, the species in question will be a species group such as Eucalyptus, lifeforms such as amphibians but can be as generic a List as you like.

As a side-product of this tool, you can optionally generate a species richness and an occurrence density map. Could be handy. Could be illuminating?

More information about this option can be found at Tools | Points to grid.