hi wr1nkles,
scenario: nobody is in the project and you are the first one to ckeck in:
when you see the "whole area option" you can draw a polygon with the marquee tool. when it is drawn, the "individual area" option should be choosable.
of course, if other people of the team are already loged in, and the first user has reservated the whole area, this will not work!
so you have to organize it in your team, that everyone only reservates the area he/she really needs to work.
the "individual area" option is very powerful: you are also allowed to draw elements outside your area. next time you send and update, you will be asked, if you want to be still owner of those elements or if you want to give them to the other user in which area the part is located.
check it,
best regards, gerd