The Custom Fields feature started as a consultancy job in which we agreed the work can be open sourced as part of IssueTrackerProduct so I never got around to write an sensible high level documentation for it. Now I have! From the news piece about it:
"Custom Fields was a feature that was released almost a year ago but didn't have much documentation. Especially easy documentation that describes what it is and how it can be used. That has changed now.
In Custom Fields it is now described what they are and how they can become useful to you. It's such a powerful tool that very few "competing" issue/bug tracking systems can offer."
The written documentation is here: Custom Fields