A Texture Projection helps you apply a 2D image texture map to a group of faces in a spherical or cylindrical fashion. There is a also a plane projection you can use if the Group Map scheme in the coordinate window is not aligned to the axis of your mesh.
A texture projection does not have a 2D texture associated with it. Any faces that use the texture projection to assign texture coordinates will use whatever texture is applied to their group.
Use the Create Projection tool to create a texture projection. After creating the projection, you can add faces to the the projection by selecting the faces and then selecting the "Texture Projection" from the Projection Properties panel, or by using the "Add Faces To Projection" button in the Projection Window.
After creating the projection you can change the type of projection (sphere, cylinder, plane) Using the Projection Window or by selecting the Projection Type from the Projection Properties panel.
You can resize the projection by selecting it and then using the Scale Tool. You can rotate the projection using the Rotate Tool.
On the cylinder and sphere projections you will notice that one of the dashed lines is thicker than the others. This is the "seam", or the location where the texture coordinates wrap around the edges of the 2D texture. You can rotate the projection to change where the seam is applied to the mesh.