my very basic understanding is that this allows a coinjoin to happen between multiple parties, but instead of having a single large coinjoin transaction that has everyone's inputs and outputs each party sends their own individual transaction.

This seems to have some good privacy benefits, as it would make it much harder to see that a coinjoin is happening, as each transaction just looks like a normal transaction with 1 input and 1 output, and does not look like a coinjoin.