I've recently become interested in the equation for gravitational time dilation, which is as follows:
$$ t_{0}=t_{f}{\sqrt {1-{\frac {2GM}{rc^{2}}}}}=t_{f}{\sqrt {1-{\frac {r_{s}}{r}}}} $$
I understand the concepts of proper and coordinate time, along with the Schwarzchild radius. However, Schwarzchild's other contribution is griefing me, which is the $r$, or "the radial coordinate of the observer" based on the Schwarzchild metric.
I've tried researching this r, but everything I find makes it seem more confusing. If it is really a "sphere centered around the body", then it is not necessarily a physical entity, as I understand it. If that is so, then why does its circumference / radius have any bearing on time dilation?
Could someone direct me to the answer of what it is, and what it's purpose is?