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So I see that certain things can take extra armour. I can't find a rule on what this does in my rulebook or CSM codex. Anyone care to explain?

Extra Armour
Some Space Marine vehicle crews add additional armour
plating to their vehicles to provide extra protection. Vehicles
equipped with extra armour count Crew Stunned results on
the Vehicle Damage tables as a Crew Shaken result instead.

Neconilis wrote:Extra Armour
Some Space Marine vehicle crews add additional armour
plating to their vehicles to provide extra protection. Vehicles
equipped with extra armour count Crew Stunned results on
the Vehicle Damage tables as a Crew Shaken result instead.

Ah. Found it. Is it worth it to spend more points for Possesion?

I would not take possession, on shooting tanks it reduces your BS and on transports it costs almost as much as the rhino itself.

The only things you should take demonic possession on is landraiders and vindicators. Here the twin-linked and ordnance weapons mitigate the effect of BS3 and always being able to move and fire is very effective. Being able to ignore 1/3 or 1/2 of the vehicle damage table for a negligible downside is well worth 20pts. On everything else, however, the loss of BS reduces the effectiveness of the vehicle.