Diffraction ”Airy Disk” is an optical effect that can really limit the resolution of your photography, no matter how many megapixels your camera may have.
Normally, light travels in straight lines, but can become diffuse (spread out), or diffracted when squeezed through small space, which happens to include your cameras aperture. So basically, the smaller the aperture, the higher the diffraction. This is why cameras have a sweet spot (when the sharpness is at its maximum) and after that quality degradation can become quite apparent, thanks to diffraction softening and rendering the image.
Knowing your lens’s limits can really help your photography, and avoid you having to compensate for the darkness of the aperture, only to see that the images are unusable. This can be done by setting your camera on a tripod, and photographing a fixed subject at every available aperture. Open them in an editing program, and crop them at 100%. Compare the results, an you will notice that your lenses sweet spot is likely to be somewhere between f8 and f16. Below this, the image degrades, and by f22 of f32 it becomes clear that small apertures should only be used as last resorts.
The finest lenses available are brilliant in every way, but diffraction cannot be completely eliminated. Finest lenses are only limited by diffraction, and so are called diffraction limited.
A digital camera using the bayer array can only collect one primary colour in each photosite, and in theory, this should allow diffraction to cover about 2-3 pixlels before it interferes with resolution. In reality, this still interferes with the quality.
DSLRs have larger sensors, so need narrower apertures to create the same depth of field. On the other hand, they can also be stopped down to lower apertures before the effect of diffraction interfere with the resolution, so it balances out. They also generally have a larger aperture range, and the blurred backgrounds they produce is great for portrait photography, and sports photography..
I hope this helped you, it was simply a little scratch in the surface.