The left hand pane in gtkpod displays all the repositories that have been created. A repository is (like it implies) a collection of all music tracks, videos and photographs imported into it. They are associated together by a binary XML database file that is the same format as the one that sits on an iPod.
By default, gtkpod creates a Local repository and a Podcast Repository. These sit on the computer with gtkpod (they can be found under the ~/.gtkpod directory). By having a local repository, it is possible to import tracks into gtkpod without needing to copy them straight to an iPod. This means that if the cover art, for example, needs to be changed then tracks can be managed without even having the iPod plugged in.
Of course, gtkpod is pointless without accessing an iPod. In the same pane as the local repository, new iPod repositories can be created. These repositories related to iPods by model and mount point. Normally, one repository is sufficient but as you can see below, it is possible to set up multiple iPod repositories on the same computer.