I don't know about that one but many DRO's will store tool dimensions and offsets, calculate bolt circles and linear hole patterns, angles derived from absolute positions and so on. The tool feature is only useful if one is studious about keeping the tools labeled and cataloged otherwise it will bite you in the a$$ down the road. The ability to set a o position with the touch of a button is priceless, the scales are also independent from the lead screws so any lash is rendered meaningless.
For the most part you will simply find the 0X, 0Y, 0Z position of the work piece, (or the actual diameter on a lathe X axis, this is what the Radius/Diameter toggle is for) and move from there. Be aware that most have Absolute Position and Incremental Position modes.