The discussion explores the rationale behind using the least number of significant digits in multiplication and division, while applying the least number of decimal places in addition and subtraction. It emphasizes that significant digits indicate the precision of data, and the result of an operation cannot exceed the precision of the least precise number involved. When multiplying, the relative errors of the numbers dictate the significant figures to maintain, while for addition, the larger error determines the decimal places. The conversation also touches on the importance of not rounding until all calculations are complete to avoid compounding errors. Overall, understanding error propagation is crucial for accurate mathematical operations.