Some of the above replies have already elaborated on it.
To simplfy, almost all auto-boxes have possibility of usuing it like manual gear. D4 just means that during your normal driving your car will shift upto 1-2-3-4. As its auto box you don't press the clutch and gear shift up automatically. In D3 you shift up 1-2-3 and the car will not go onto 4th gear, so you can use it around town but you will not be able to achieve higher speeds as 4th gear is not engaged and also when you keep driving in third your fuel consumption will increase. The next is D2, in that you shift up only 1-2. Many auto boxes have another gear D1 or L (or whatever manufacturer chooses). In that you start in 1st gear and remain in first, so obviously you can't go fast etc etc.
Now Why shouuld you use D3 or D2 coming down hill, well for engine braking, if you do prolonged downhill driving and keep using brakes to slow down, the brakes can eventually overheat and sometime fade. To avoid this, you use D3 or D2, depending upon how fast you are going at the time and this will reduce your speed from engine braking as you won't shift further that 3rd or 2nd gear depending on your choice.
Same for steeper uphill drives, to stop the car shifting in 3rd or 4th gear and consequently lose the power and then having to press the accelerator pedal hard which makes the car change down the gear with a jerk. You simply chose D2 or D3 depending on inlcine, it will stop the gear shifting up and so you remain in power band constantly and hopefully climb more easily.
The overdrive is usually a separate feature and unless you have over drive on -off button you cannot disengage it in your vehicle. The overdrive off- button in simple terms means the car will shift to one gear lower (depending on how many gears in auto box 4 or 5) and remain there. Hope this clears it up for you.