Chocolate is created by a long process that culminates in the grinding and milling of cocoa beans (or nibs) to produce cocoa solids and cocoa butter. The cocoa butter and cocoa solids are them mixed with milk, sugar, and other flavoring components to get the desired taste. The definition of chocolate caries based on the government and country (with lobbying groups constantly trying to reshape these definitions).
The US FDA requires that semisweet or dark chocolate have at least 35% cocoa liquor. Semisweet chocolate contains half as much sugar than cocoa solids and bittersweet chocolate contain one-third as much sugar than cocoa solids. Couverture chocolate is chocolate that is rich in cocoa butter. The increase in cocoa butter makes couverture chocolate much more expensive than other forms of chocolate.
In cooking and baking, the quality of chocolate makes a great difference. For recipes like chocolate chip cookies and muffin, Nestle chocolate is sufficient. But any recipe which places a strong emphasis on chocolate necessitates a higher grade chocolate. I use Ghirardelli chocolate chips for custards, cakes, and ice creams.