The timeline is created from the date/times on the scenes in your ywriter project, so in order to make a project timeline you have to have created the information in your project. I used this with a decent sized project and it made sense of it for me. It also exposed a few amateurish plot holes based on when things happened...
I am sure that Peter or Simon will correct me if I left stuff out or said something wrong, but I like these tools and they work for me. YMMV.