Not the GP, but by axis they mean XYZ euler angles. In 3D animation software you typically have a set of curve graphs that show transformations vs time, that allow the animator to tweak timing, ease in/out of keyframes etc. If your object has its rotations animated as a quaternion you effectively lose this functionality, because the individual XYZW components of the 4D rotation don't correspond to anything intuitive in 3D space. So typically you want to keep your rotations in euler angles except in the special cases when you run into gimbal lock etc.
Okay, let's see if I have this right. The rotations are animated by manipulating the graphs of three functions of time, the values of which are the amounts of rotation around each coordinate axis?
The only rotation animations I've made have been done with code.
Pretty much. Usually you do the rough animation by manipulating the objects in the 3D viewport (with the manipulator using euler angles even in the cases where the angles are then converted to and stored as quaternions) and marking keyframes. The graph view is then useful for tweaking the interpolation between keyframes, minor adjustments, copying and pasting keyframes and such.
The graphs are time on X against rotation/translation/scale amount on Y, yes, with separate graphs for each axis.
