Hi Nick, yes you're right about it being for intonation. This is easiest to do with an electronic tuner. Using the tuner tune your open strings dead on. Now check the intonation by playing the high G at the 12th fret. If it's sharp move the bridge toward the tail until it's tuned dead on. If it's flat move the bridge toward the neck until it's dead on . Now check he low G string and you'll find the bridge will have to be angled back toward the tail to get the low G in tune at the 12th fret. Get your high and low G perfectly in tune both open and at the 12th fret and your D string will be perfect or very close.
Yup . setting intonation , a small adjustment for fatter strings , and string height . etc ..
If you are using nylon stings, the saddle is straight. With steel strings if I remember correctly (it has been a while), the saddle offset is 1/8" per inch
intonation... this is VERY VERY important and positioning is CRITICAL. if it's off even by a little it will sound OFF !! The goal of saddle positioning is to get your 12 fret harmonic to line up EXACTLY over the 12th fret
Always happy to help.
This is an oversimplification:
Thin strings bend easy over the nut and bridge, thick strings have a little bit of stiff bit at the bend that doesn't vibrate. Think of it like trying to measure the curve of a rocking-chair rocker with a tape measure versus a wooden yard-stick.