Sorry that some of these things are unclear.
1) The woods are a representation of the emotional state of Pauline. It's a visualization of how she feels. This is what her world is like, even though, physically, she is still in the office.
2) The goal is to help Pauline make it through a whole day without having a Panic Attack. This means that each time she is in the forest, you are trying to defeat the Demons you are facing.
3) The collectable items can power up the corresponding Comforts that can be found in a forest. This can lead to some interesting sequencing decisions. Read the journal for hints about which items empower which Comforts. So, if you have Sugar in your inventory and then you find and drink Coffee, it's more effective than if you just had the coffee without sugar, for example.