This entry is optional. Enter a domain name for the local network. The router's DHCP server will give this domain name to the computers on the wireless LAN. So, for example, if you enter mynetwork.net here, and you have a wireless laptop with a name of chris, that laptop will be known as chris.mynetwork.net. Note, however, if the AP's settings specify "DHCP (Dynamic)" Address, and the router's DHCP server assigns a domain name to the AP, that domain name will override any name you enter here.
Is there a benefit I'm forgoing by omitting this?
Really depends on how you use your network. If all your machines already see each other, and you connect by name, this setting won't add much beyond complexity. However, if you ever find yourself trying to get to another machine by IP address, this can help move you to using names.
My personal preference is to connect to anything by name, and my network does this via Bonjour. This setting in the router is another way, where everything on the network can have a name like "laptop.gbeer.net". Then, the router can also hand out DNS search domains, allowing you to connect to the system just by typing the name "laptop" instead of "laptop.gbeer.net".
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