Uploader creates an Uploader role for file uploading.
Perhaps you have someone that you want to be able to get files from but you don't want to give them FTP access to your site or maybe they might not even know how to use FTP even if you gave it to them. This is what this is intended to fix.
This keeps it so that not just anybody can upload (possibly malicious) files to your blog. An admin has to take the time to change the account from Subscriber to Uploader. This is more secure. To make it more secure you can remove certain file extensions in the settings.
Make sure that wp-content/uploads directory is writable.