Drysc 03/05:
Basically when you queue it's going to check all of the gear you own, average out how good the gear you have is, and then assign you a number. This all happens "back stage". Invisible to you or me.
In addition it's also going to check how many people are in the party you queued up with. When it's trying to find others to match you against it's going to take your gear number, and party size, and try to find other people/teams that fall within your same gear and organization level. If you're in greens and playing by yourself it's going to try to match you up with others that are in greens and playing alone.

It's not going to be completely accurate all of the time, or even most of the time because we would rather you get into a game where the matching is a bit off instead of making you wait a really long time until the perfect match finally queues up. It's going to help though.

The benefit is taking out some of the skewed match ups that usually just don't end up being fun at all, and trying to place players and teams in situations where they're at least close to each other with their items and organisation.