Well Ground clearance is the clearance between the lowest point on the car and the road surface.
well i think ths picture can help....!
In this pics u can see 4" gap b/w car lower surface and road....! this distance is called ground clearance...!
The more the distance..less the car grips..the less the distance...better car grips but need to make sure its not to lower that car hits every 2nd bump and also engine oil chamber is above ground so it won't hit anything...!
Our local Z-gen have more ground clearance as compared to JDM ones....!