> The documentation states that
> 
> "This is the value that is seen in buffers that
> do not have their own values for this variable.
> The default value is meaningful for variables
> with local bindings in certain buffers."

Good to see you are looking at the doc now!

Did you read the nodes previous to that one,
in the same chapter (Buffer-Local Variables)?
I think they answer your questions.

> When do buffer variables have their own values,
> and when do they not have them?

I think node `Creating Buffer-Local' explains this. 

If you don't create/set a buffer-local value in
buffer A for a variable then its global, "default"
value applies in buffer A.  It's as simple as that. 

> How can one figure out what has been set or not (whether buffers have
> variable values or not)?.

Check whether (buffer-local-value THE-VAR) is the
same as (default-value THE-VAR).

Again, this is explained in the node that precedes
the node you quoted from.

I suggest starting at the beginning of chapter
Buffer-Local Variables, and reading from there.