When playing the guitar as an accompniment (sp?) to another instrument or singer, it makes sense sometimes to transpose. A capo is used for this. When music is written for piano or some other instrument, no regard is taken to how easily the piece can be played on a guitar. Using a capo many times can be used to fix this. I experienced this while playing in our church choir accompanying the piano and violin. The capo made many difficult songs to play very easy.

Some artists regularly detune their guitar and play in keys like Eb. SRV did this because he liked to use very heavy string guages. Heavy string guages are harder to bend, but this can be alleviated by dropping the tuning down a step.

Here's everything you ever wanted to know about concert pitch:
http://en.wikipedia.org/wiki/Concert_pitch

The short version, the A above middle C is 440 Hz. Everything else is tuned relative to that.