IFR requirement for altimeter question (i.e. +/- 75 feet)
Barometric pressure isn't a constant. Just because you're at sea level, doesn't mean the air pressure is going to be exactly 29.9212 inHg. That's just the average sea-level pressure. So, for instance, if the sea level pressure is currently 30.9 inHg, then all altimeters in the region are going to read 1000 feet below the actual altitude of the airplane.
Those fluctuations are the point of the altimeter corrections provided by AWOS/ASOS/ATIS. By entering the actual sea-level atmospheric pressure into the altimeter, you can correct for those fluctuations and get a more accurate reading of your current altitude.