DAD provides a massive extension incapabilities of an HPLC system.
Instead of monitoring a single wavelength, all wavelengths in the UV and possibly the visible region are monitored with time. This means that we have the UV spectrum of each peak available for confirmation of peak ID. This gives added confidence in results where many peaks are involved, and is invaluable for method development where changes in peak position would otherwise go unnoticed as separation conditions are optimised.
Using this option, data is represented in several ways. We have the 3D plot, looking at the chromatogram and spectra in 3D from an angle, and using colour to emphasise peak height:

Then we have the Isoplot view, which is an overhead view of spectra vs time, again using colour to represent peak height:

In any views we can highlight and see the chromatogram that would arise from detecting at that wavelength, and we can highlight a peak and see the UV spectrum of that component as a 'time slice' spectrum.
Diode array can also give an indication of peak purity. Two co-eluting peaks rarely co-elute exactly on top of each other, and as a consequence we can detect a change in the UV spectrum through the peak. Monitoring the ratio of the absorbance at two wavelengths gives us an indication of peak purity:

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