Reordering is a very handy way of making sure that your photos are easily identifiable.
For example, you may have 10 folders filled with images from your digital camera and they may be titled "dig-camera001" thru "dig-camera200".
However, when you print out the thumbnails, it will show the name as "era001" thru "era200". And since the images were in different folders, they could have the same name. The reordering makes it very easy to reference a picture on a CD. So if you send to a photo lab or a friend, you can say print picture "93" and not have to worry that they print the wrong one! In addition, to renaming the photos, when this option is chosen, there are no folders on the destination CD or DVD.