i386 - 80386 CPU
i486 - 80486 CPU
i586 - Pentium I CPU
i686 - Pentium MMX and above CPU.
Intel Processor architectures are downward compatable so an i386 compiled kernel will work on any processor. An i586 compiled kernel will only work on Pentium CPU's i.e PI,II,III and P4's
Some distros only release an i386 kernel. If you want to optimize it for your CPU you will have to recompile the kernel.