I'll try again, maybe I should have been clearer initially but I thought this was conceptually straightforward. Maybe I've just been thinking about it longer...
Actually, the number of unique combinations (with order unimportant) for all 32 digital inputs is 528! I've 'wasted' 9 of the BU0836X inputs on rotary switches which require three digital inputs each and so am left with a measly 276 unique combinations.
Suppose that Ctrl = Command_1, X = Command_2 and Ctrl+X (pressed simultaneously) = Command_3. These commands are sim controls like fire, open canopy, wheels down etc.
BU0836X has 32 digital inputs. Out of the box this lets you program 32 buttons or switches to whatever command you like in the sim of your choice. If your sim allows combination keyboard inputs (i.e. not only Ctrl and X inidividually but also Ctrl+X) then you could theoretically activate an additional sim command by simultaneously pressing Button_1 (think of this as Ctrl) and Button_2 (think of this as X).
The difficulty is that you could not achieve the same effect just by hooking up a third button (Button_3_ to connect both +V terminals from Button_1 and Button_2. In this scenario Button_3 would activate Input_1 and Input_2 but so would Button_1 and Button_2 since the circuit would be identical for all three buttons. That's why you need the diodes. If you added a couple of diodes to interrupt the circuit around Button_3 then this setup will work.
Whilst this would work for just a few buttons if you tried to manually link up numerous combination inputs you would end up with an enormous tangle of wire. Hence the matrix board with the diodes and crossovers neatly contained and only the 276 (or 528) wire leaving the board to the buttons and 23 (or 32) wires leaving the board to the BU0386X.
So in summary, no, this does not increase the number of inputs from BU0836X. It simply allows you to use BU0386X with numerous double-inputs. This is useful for sims where you can trigger three different commands by (for instance) Ctrl, X and Ctrl+X.