It creates a really cool chorussy sound and makes the guitar extra heavy. Then mix down onto another cassette. The new cassette has everything but the vocals on two tracks leaving you with two more tracks to do vocals, leads or whatever. This process can be repeated for more tracks. Frank Zappa recorded an album on a 4-track this way and got 48 tracks on it.
Most amps really shine when cranked up.
When doing the final mix, if you have a stereo chorus, you can give the tape a more stereo sound. Another approach, and one that's the opposite of that mentioned by Dave Copland in another post, is to try to get a good live recording of as much of the band as possible in order to avoid generation loss due to bouncing. Basically what you do is to put a couple mikes in front of the drums in an X-Y configuration. One mic goes to one channel the other to the other. Find a way to get the bass in the center of the mix, either by putting the bass amp behind the mics, across from the drummer, or by running the bass direct and record onto the same two tracks that the mics are recording on with the bass panned center.