The cache partition contains most of the temporary files, logs and remembered bits from the various applications on your Android device. They can also be left over files from before your last Android update. If that happens your device could be trying to use stored files that are not meant for your current version of Android. Think of it the same way you think of your browser cache. Just like a browser cache, sometimes those stored bits cause more problem than they solve and so it is a good idea to delete the cache periodically.
Wiping the cache will NOT delete your apps or your data or your configuration. It will simply delete the temporary junk.