The Touchpoint Server shipped with TDI provides access to TDI components (Connectors and AssemblyLines) through a ReSTful communication protocol. Clients send HTTP requests to the Touchpoint Server in order to request from a TDI Server to create a Touchpoint Instance which the client can then "talk" to.
A Touchpoint Instance is implemented using standard TDI Components and allows HTTP based clients to access third party systems that TDI can "speak" to. In this context the Touchpoint Instance can be thought of as a "proxy" between a client application and a remote service, as it allows clients to use a unified protocol for communication to a variety of systems that don't have an HTTP based interface.