In the discussion about Clipper Circuits, participants clarify the conditions under which a diode is forward or reverse biased based on input voltage (Vi) and reference voltage (Vr). It is established that when Vi is less than Vr, the diode is forward biased and conducts, while if Vi is greater than Vr, the diode is reverse biased and does not conduct. The output voltage (Vo) is also influenced by the diode's state, with specific calculations provided for various Vi values. A key takeaway is that the diode will conduct only if Vi is approximately 0.7V lower than Vr, emphasizing the importance of understanding these voltage relationships in circuit analysis. This method aids in visualizing and solving clipper circuit problems effectively.