How to add service known types from external config file

Question

Hello,
I am having difficulty understanding how to exactly go about adding known types; for WCF, from a configuration file that is external to my wcf.  I found an example of how to set the configuration file up, however, I am a bit confused as to the way the file is set up and I am not sure as to how I am actually supposed to call this configuration file to load the service known types to my wcf. Here is the example of the configuration file containing the known types.
http://codeidol.com/csharp/wcf/Data-Contracts/Data-Contract-Hierarchy/
I am confused about why you have to add the a type and then specify another type as a child of that type just added. It seems to me you would just add the type "Contact", specify its assembly; "Host" and that would be it. Why is it that a knownType element tag follows the add type element tag specifying another type?
Also, once I have configuration file set up properly, when and how do I call it from my wcf? Any assistance would be appreciated. Thanks!