This page describes a historic artifact in the history of OpenStreetMap. It does not reflect the current situation, but instead documents the historical concepts, issues, or ideas.
For rural areas which have big areas of blank map priorities are to see the major roads to each town, so that it can be used for finding a way there, and the names of the towns.
City - Capital cities and large regional centres. Wikipedia has a full list.
Town - Place with plenty of shops and providing services to the district.
Village - Place with a few shops, but limited services, maybe a pub and a general store.
Hamlet - Very limited to no services. For example, no pub and no store.
Locality - place of interest but no-one lives there eg lookout or old rural name
Mark a separate node at the Post Office place=town to put the town on the map. If there isn't a post office use the pub or a community building to place the extra node.