grub menu is basically a list of options give to you by your boot loader. If you had windows xp install next to kubuntu then it would give you the chance to boot into kubuntu or windows xp.
Grub is nothing more than the boot manager. This is what boots the linux kernel up and running so it can start all the processes that gets linux up and running.
What they are having you do is allow the system to boot up into (the best analogy would be the windows rescue shell) so that you can reset your password. However in kubuntu root does not have a password. your user does. so when you boot system into this mode you will need to do the following
passwd <your user name here>
and that should change your password.
* edit *
Also the grub menu is the first black screen that you see. It normally has a timer that counts down. should look something like
Grub Loading Stage1.5
Hit any key to stop count down