L2 is also known as Euclidean space. It says the length of a vector is the square root of the sum of the squares of its components. There are other ways of defining vector length (or distance). E.g., in L1 is the sum of the absolute value of the components. The way distance is measured changes the properties of a space. E.g., in L2, Pythagoras is trivially true, but in L1 the hypotenuse would be as long as the sum of both other sides. That has far reaching consequences. E.g., in L1, you can't take a shortcut.

Wikipedia is not your friend, it seems. It's just terse definitions. Perhaps other math sites are more helpful.

It may not describe the entire universe, but it's a useful approximation for short distances. Like pretending the earth is flat.