The Codex doesn't really explain it very well, what is it used for and how do I use it exactly?
It is explained pretty thoroughly in the Codex, in my opinion. It serves a purpose e.g. when you want to grab posts for your taxonomy, it is a URL slug for your taxonomy, e.g.
Note: The query_var is used for direct queries through
new WP_Query( array( 'people' => $person_name ) )
and URL queries like
falsewill disable these methods, but you can still fetch posts with an explicit
WP_Querytaxonomy query like
query_var is part of the WordPress Query Vars.