Someone with a little more context/history may have a better explanation, but here's my guess.
First, notice that /.cshrc is hardlinked to /root/.cshrc.
Code:
> ls -i /root/.cshrc /.cshrc
9 /.cshrc 9 /root/.cshrc
Now, imagine booting the system to single-user mode, where no filesystems other than / are mounted. I'd imagine (but I have not tested this) that /.cshrc will be executed (assuming csh is used as root's shell), so any nice customizations you've made in /root/.cshrc will still be there in single-user mode.
Other explanations will follow I'm sure.
