An Anno-J 'instance' is a website that you can visit to use the application. For example, the Salk Epigenome site is an 'instance'. Using an instance of Anno-J is simple; just visit the website using a W3C compliant web browser such as Safari or Firefox.
Creating an instance is a little more involved and requires website administration skills plus access to a web server (Mac OS X users: you already have access to the Apache web server). If you don't feel confident at this stage, then contact your local website administrator for advice.