I am sure I am missing it but I cant find any documentation on how to use this? Should I be using this for button or "icons" instead of just creating objects and why?
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They are the icons for the executable or the app displayed on mobile devices, like what you see when you install it, or how it's viewed in the store and other places.
Oh ok, seems obvious now. Thanks plinkie
They also are the "favicon" displayed in the URL bar of a browser on desktop.
This folder also contains the loading-logo.png file which is the image shown when first loading your game, using the "Progress bar & logo" option for the loader style property of your project.
Icons are also used when using the browser "install" feature (for Progressive Web Apps, and all exported web projects are PWAs). E.g. this lets you create a desktop shortcut to a web game, and it uses the icons for the shortcut.
Some (but not all) exporters also look at the icons and use them as the app icon where possible.
Thanks all, very useful info.