Input Languages in Windows 7
Windows 7, like most operating systems (OS), wants to know which language you are using. This is to enable the OS to present and interpret information correctly.
The notion of 'Input Language' is thus used to select which language you are using. Many of us are using several different languages, such as Norwegian, British English or German. To allow for this the OS can work with multiple input languages at once, and you can select which one you want to use on a per-application basis.
Windows 7 uses the 'Language bar' to allow the user to enable and select different input languages. One language is set as default input language, and are used for all newly started programs. The other languages can be activated with the language bar, and will remain in effect for the active application.
The active input language influences the way Microsoft Office handles proofing of text in documents. Please have a look at this article for a discussion of the topic.