It is a serial port with nothing connected to it.

I assumed that much, but what is it good for?

Well most PC's had 2 COM ports with nothing connected to them. They are set to "dummy" in DosBox most likely for compatibility reasons for programs that expect a serial port to exist but do not necessarily need to use them.

So first Y2K and now failing if the PC has less than 2 COM ports. What will we do with these 1980's/1990's programmers?

Nothing because they don't do that anymore. They didn't expect their
stuff to be run that long.

Escuse me? I'm talking about WORSE PCs than what they expected. As in only 0 or 1 COM ports.

They aren't worse but were back then highly unlikely. Thus the assumption was fine.