A chroot jail is a way to isolate a process and its children from the rest of the system. It should only be used for processes that don't run as root, as root users can break out of the jail very easily.
The idea is that you create a directory tree where you copy or link in all the system files needed for a process to run. You then use the chroot() system call to change the root directory to be at the base of this new tree and start the process running in that chroot'd environment. Since it can't actually reference paths outside the modified root, it can't perform operations (read/write etc.) maliciously on those locations.
On Linux, using a bind mounts is a great way to populate the chroot tree. Using that, you can pull in folders like /lib and /usr/lib while not pulling in /usr, for example. Just bind the directory trees you want to directories you create in the jail directory.
Although POSIX has a standard for capabilities which I think includes CAP_NET_BIND_SERVICE, these are not required for conformance and may in some ways be incompatible with the implementation on, e.g., linux.
Since webservers like apache are not written for only one platform, using root privileges is the most portable method. I suppose it could do this specifically on linux and BSD (or wherever support is detected), but this would mean the behaviour would vary from platform to platform, etc.
It seems to me you could configure your system so that any web server could be used this way; there are some (perhaps clumsy) suggestions about this WRT apache here: NonRootPortBinding.
So why are they traditionally being started as root when afterwards everything is done to get rid of implied security issues that come with it?
They're started as root because they usually need to access a privileged port, and traditionally this was the only way to do it. The reason they downgrade afterward is because they do not need privileges subsequently, and to limit the damage potential introduced by the myriad of third party add-on software commonly used by the server.
This is not unreasonable, since the privileged activity is very limited, and by convention many other system daemons run root continuously, including other inet daemons (e.g., sshd).
Keep in mind that if the server were packaged so that it could be run as an unprivileged user with CAP_NET_BIND_SERVICE, this would allow any non-privileged user to start HTTP(S) service, which is perhaps a greater risk.
Best Answer
There are a lot of reasons to use a chrooted environment, you can use it to keep different versions of one program, you can use it to simulate an specific environment in order to test some features, to create images of a system different from your main one, etc.
Wikipedia can tell you more about chroot jails and its usages.
From there: