What is preemption / What is a preemtible kernel? What is it good for?

You should really use the term "preemptive." There are different kinds of preemption. Essentially, it is very simple and you probably understand this by another name. A preemptive operating system can switch contexts between user mode threads without any special programming in the preempted application. This allows for multitasking. An OS can switch away and back to a process and this switching is essentially trasnparent. There is also such a thing as preemptive kernel, which allows kernel mode threads to be preempted (most operating systems do not allow this but it is required for certain applications such as in real time systems). Note, this is a very simplified explanation.