manifold pressure is the air pressure in the intake manifold, "past" the throttle of the engine. so, at sea level, with the engine off, it will read around 29.92 inches of mercury (standard atmospheric air pressure). a running engine at wide open throttle at sea level (assuming naturally aspirated -- not turbo/supercharged) it will read the same 29.92. any throttle setting below wide-open, the engine is "sucking" against the throttle valve, so the MP will be somewhere below 29.92. in our ah rides, i think pretty much they're all turbo/supercharged, so you will see MP wayyyyyy over 29.92
we use MP, because it shows how much air is going into the engine, a good indicator of how much POWER is being produced, since we cannot rely on prop/engine rpm since the prop is spinnning at the same rpm no matter how much power is actually being produced.
the prop rpm is basically controlled by a governor. powered by oil pressure fed into the hub of the prop where there is a piston, gears, etc. to change pitch of the blades. when you set rpm, you are controlling the governor, not the pitch of the blades directly.
you set prop rpm for a certain rpm, say 2000. At low power (manifold pressure), the prop needs to stay pretty fine to maintain 2000 rpm. the engine is doing 2000 rpm and has very little load upon it. as you add power, the prop and engine would quickly go over 2000 rpm being at such a fine pitch, so the prop automagically and smoothly goes to coarser pitch (bigger bite) to maintain the selected rpm. the engine is doing more work now at 2000 rpm.
the reason this is the way it is, is because props are really only efficient thru only a small rpm range.
i hope that makes sense.