Can someone give a thorough explanation of this following fragmented text(source:Linear Algebra and its Applications)?
"The space of $3$ by $2$ matrices. In this case the “vectors” are matrices! We can add two matrices, and $A+B = B+A$, and there is a zero matrix, and so on. This space is almost the same as $\Bbb{R}^6$. (The six components are arranged in a rectangle instead of a column.) Any choice of $m$ and $n$ would give, as a similar example, the vector space of all $m$ by $n$ matrices."
I'm baffled by the dimension of a matrix and its coordinates.
Avoiding any technicalities and putting everything in a simple language: Note that the term vector simply means a point of a vector space. The fact that $\mathbb{R}^n$ is the simpler vector space and its points are of the form of a "vector" in the usual sense is what confuses you, I believe.
In the case of the real vector space $\mathbb{R}^3$, an arbitrary point $(x_1,x_2,x_3)$ is specified by 3 real numbers namely, $x_1,x_2$ and $x_3$. This explains why the dimension is 3. Now consider the $3\times 2$-matrices with real entries. An arbitrary point of this vector space is a matrix which has 6 entries. So in order to specify a random point you need 6 real numbers. This explains why the dimension of this vector space is 6. Analogously for the case of $m\times n$ matrices.
If the question is why the set of $m\times n$ matrices with real entries is a real vector space, then you need to recall the definition of the vector space and check (similarly with the case of $\mathbb{R}^n$) that it satisfies all required properties.