Applications have message queues where windows places input-related messages (mouse, keyboard, etc) that the application needs to process. The application runs in a loop called a 'message pump' which basically keeps checking the queue to see if there are any pending messages, and if there are, it processes each of them, until the queue is empty. At the point when the application returns from processing queued messages and checks the queue again, it is in the 'idle' state. Each time that happens, the idle event is raised.
Entering and leaving quiescent state are preciesely what their names imply. When AutoCAD is polling for input while there are no active commands (e.g., at the command prompt), it is in a 'quiescent' state. When it is busy doing something, it is in a 'non-quiescent' state. Entering/LeavingQuiescentState signal the transition between those two states.