What does 'op' exactly mean in an submit button? In the form_state['values']['op'] = t('Save');

What does 'op' exactly mean and do ?
I'm pretty sure it's shorthand for the word operation.

It doesn't 'do' anything as such, it's the name assigned to all submit inputs so that the form processor can identify which button has been pressed (and perhaps fire off different submit handlers based on that).

And it looks like it's gone in Drupal 8 (in favour of $form_state['triggering_element']), so enjoy it while you can :)