TXJole's explanation of the gimbal bearing is right on, but for the newer guys here's a bit more detailed explanation. Between the engine and your drive, there obviously is a drive shaft. The shaft runs through the boat's transom and into the drive (actually it's more permanently connected to the drive, and is inserted through the gimbal bearing and into the engine coupler when installing the drive). The gimbal bearing is a bearing surrounding and supporting the drive shaft. It's located in the transom or in the drive's transom shield. On Volvo drives, look on the starboard side of your transom shield (outside of the boat, up against the transom) and you'll see a recessed grease zirk. That zirk feeds grease through a tube directly to the gimbal bearing. You should give it a few pumps of grease once or twice a year, preferably with the engine running on muffs. If you feel resistance when pumping the grease, stop - don't force it.
This is an example of something your dealer should do during annual service without you having to worry about it, but there's a good chance they don't. As you can tell from the location of this bearing, replacing it isn't a trivial job labor-wise (labour Graham).
The purpose of aligning the engine is to ensure that the drive shaft has a perfectly straight shot from the drive, through the gimbal bearing, and into the engine coupler, without binding anywhere or placing any unnecessary stress on the gimbal bearing or other components. It's the kind of thing that can be off a bit from the factory and deserves to be checked at 20 hours. Generally they seem to be OK but I've heard at least one story of it being WAY off. Once done, it shouldn't really need to be checked again for a couple of years, but it's a good idea to have them check it anytime they're going to have the drive off for any reason.
Evidence of a worn-out gimbal bearing is a growling sound coming from that area, at first usually only during a turn to one side or the other or both, and gradually becoming constant anytime the engine is running (the drive shaft turns at all times when the engine is running, unlike a car). My neighbor's (neighbour Graham) '96 Horizon is on it's 3rd gimbal bearing. The original had to be replaced because the dealer screwed up on some maintenance which led to it's early demise (they admitted it and replaced it at their cost). The 2nd one had to be replaced because he never knew it needed to be greased

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