Can someone tell me what exactly is msg used for

You should refer to the discussion here: Are MSG and Accent (Seasoning) the same thing?

Some relevant points: MSG is found naturally in seaweed and other things. It is used to enhance the flavors it is combined with.

It is completely harmless unless you are limiting your sodium intake. Check out the wikipedia article on the subject as a starting point: http://en.wikipedia.org/wiki/Monosodium_glutamate#Health_concerns

In short there has been no linkage to any adverse effects found in many controlled studies.

As far as replacing it- You can leave it out altogether or add a little salt.

As you are no doubt aware, there are 5 basic tastes - salty, sweet, sour, bitter and umami. Umami is the savoury flavour of mushrooms, cheese, cured meats, and so on. MSG is essentially 'pure' umami. In other words, MSG is to umami what salt is to salty and sugar is to sweet. So if you add it to savoury dishes (throw a parmesan rind in to vegetable soup while it's simmering) it enhances their savouriness.