@kvngreeley
Don't have to apologize about the questions at all! They are pretty basic but legit questions.

There is nothing wrong with MZ's vanilla resolution, if you design a whole game around that then it shouldn't be a problem. Especially with how you can just go larger screen in a modern rpgmaker game, so smaller default sizes isn't too big of a deal now.
What most people talk about when it comes to a game's resolution is actually what measurements that will give you a particular screen aspect ratio, i.e the ratio between the height and length of a screen.
This isn't a unique thing to RPGMaker and its for designing digital stuff as a whole, but in simple terms, it's a question of, do you prefer MZ's original resolution where it looks closer to a square? Or do you want a more modern day wide screen resolution where it looks more rectangular, is it ultra wide or something that fits sunggly on your phone screen? These are the different aspect ratios people are usually referring to when it comes to game resolution.
The pixel size that ends up creating that ratio is a 'it depends' situation because some people prefer to have the character take up more of the screen while others want more map in view instead. (You are only widening the view area of the game when you change resolutions in rpgmaker, not actually making the game graphics itself larger or smaller). But as you can see there are averages people found out that usually looks good.
If your resolution doesn't fit the screen's aspect ratio, example you use a square ratio when the player full screen's on a wide screen rectangular monitor, you'll end up with black bars filling up the extra space. Not that that's bad, its just the basic's of how computers work.
Changing your screen ratio mid development isn't recommended mostly because of all extra work it will end up giving you. The things you need to reposition or resize, such as pictures or objects that should or should not be seen on the map now being in the screen or off screen.