Well Gerrymandering for Congressional districts isn't a big issue in Vermont, South Dakota, North Dakota, etc.
But wherever there is more than one district, it matters.
You have a finite number of voters for your party and for the opposite party. You first have to gather data to figure out exactly what precincts (sometimes even down to the block level) your voters and the voters for the opposite party are. You actually want the opposing party to have higher margins in their districts because that means that you have corralled the other party's voters away from districts that you want to win. The object is to spread as many of your voters out in as many districts as possible without taking the chance of losing a district you currently hold.
In Tennessee, we have a rather close matchup between Democrats and Republicans. Before 2002, Republicans held a 5-4 lead in the delegation. For the 2000 census redistricting, the Democrats moved Republicans out of their target district (4) as well as out of some districts they were worried about, 8 and 6. Those Republicans were moved mainly to District 7and were exchanged with the minority of Democrats who were in 7. That means that Dist. 7 went from unlikely to impossible for Democrats to win, but made it possible for them to pick up Dist. 4.
Gerrymandering has always been a problem ever since Gov. Gerry... but nowadays GIS technology makes it far more exact and far more insidious. Companies make software specifically for political parties to gerrymander to their best advantage without breaking the Voting Rights act. This takes the burden off the politicans to prove themselves to voters, and protects incumbents from the possibility of answering for their actions.
Does gerrymandering have a major effect outside of large states? Can someone explain whether gerrymandering attempts at creating all one party dominated districts, or to have the ruling party have a significant lead in every district?
I think it is amazing how Mississippi has voted with Alabama in every presidential election except 1840 (Mississippi wasn't readmitted in 1868, but that is too much of an exception).