Your residential is a requirement to finish your Gold DofE. It is not part of any other levels. Residential involves spending 5 days (4 nights) away from home on a shared activity with people you have never met before. To clarify, this is an individual section – you won’t be going with people you know (The only exclusion to this being if you are going to a large residential location with many people).
In your Residential, you should take on an activity that requires you to work both in the day and in the evening. Both times should be just as much part of the experience. Whilst there, you should be given the appropriate training and you should find an assessor.
As for what it can be, it can be anything as long as you are learning something whilst you are there. The Residential section is very flexible as to what is accepted. As well as this, you must find a place where you can stay on-site.