In general, the domain is required for multi-tenant sip servers (like some SIP Cloud servers).
For example, a SIP Server can be used to host multiple different companies or depts. You can have extension 100 setup for company #1 and also extension 100 setup for totally different company #2
Using the domain field allows the SIP server to know which extn 1000 is begin used either company #1 or company #2.
So in the case of how many SIP servers work, you must specify the domain so it knows which extension 100 you are attempting to register with the server.
If the SIP server is not a "multi-tenant" SIP server, then you can leave the domain field blank.