An instance is the a font with a specific location in the design space. The font doesn’t exist yet, it’s just a name and some coordinates. But you can already look at it, type text and compare it to other instances and masters.
Design space locations are defined by the values on the axes, for instance (flavor=0.5, thicks=0.43, thins=0.73).
Sometimes it can be useful to make interpolations with separate factors for the horizontal and vertical in a glyph. This can be done by creating an ambiguous location, double click on the axis in the location editor, an extra slider pops up, and you can edit two factors.
An animated preview of the system can be helpful to detect problems and to get familiar with the range of variations that can be generated. Select a couple of masters and instances, pick a speed, click Play. The animation will interpolate in the order they were selected.
Superpolator can’t save animations, but good results can be achieved with various screen movie grabbing utilities.
Select a couple or all instances, and select generate. This will render UFO files which can be imported and edited. Key font values and kerning will be calculated as well.