Velocity, at it's simplest, is the force used to play an instrument. How hard you hit the keyboard, or how hard you hit the drum skin with the stick. Lower velocity strikes cause a quieter response. Now in terms of using this in a sequencer, you can map velocity controllers to pretty much any parameters. So using your hi-hat example...say you have a 16th note hi hat sequence...using velocity, you can alter the volume of each step to create swells, echo effects, or whatever.