Countries are only used in the "Traditional Search" facility.
This will allow you to customise the drop down list when the buyer needs to select the County Province or Region he/she is interested in.
The drop down is dependant on the "Country" drop down, so if you have a county disabled and have property listed in one of the regions, they will not be displayed as the buyer will not be able to select the region.
To manage these log in and navigate to the Administration Section » Dashboard » Manage Property » Counties
This is a simple screen to change the type or add a new County, Province or Region.
You need to add at least one country before you can add any Counties/Provinces or Regions.
You can filter the "Country" to only show Regions within that country to make it easy to manage the regions.