Can someone explain how attaching a template to an already active project works?

When you attach a template after the project has been created, any objects related to the template that you attach will be added onto the project itself. It will not delete any existing tasks, files, etc. that have already been added/loaded to the project. But will add any of the template elements to that project.

So it will just pop everything on the bottom?

What if there are custom forms on the template?

I've used this feature in two different ways.

1- We made "mini templates" that simply included the tasks for a certain process. For instance if a digital banner was needed we would save those tasks as a mini digital banner template. You can include any custom forms that are needed for that process. When our Project Manager converted a request to a project they would look to see what deliverables were being asked for and could attach the templates for those deliverables, thus adding those tasks to the timeline. It made the process easier for them so that they didn't need to manually add tasks and we didn't need to make a bunch of templates with different combinations of deliverables.

2- We made a template of all the forms that need to be added to projects. This template has no tasks. When creating a new project if we use this template all of the necessary forms are attached. But if a user didn't use a template they can manually attach it in order to get all of the necessary forms attached. We use a lot of Topic Group, Queue Topics and Routing Rules. Every time we make an update to any of them on a template, that template needs to be re-attached to any existing projects to get the up-to-date rules applied. (Hoping to uncover a better solution to this)