Each Coin Tools payment needs its own Bitcoin address. This is necessary so that it is clear whether or not the payment has been completed. It is also important for preserving anonymity.
bitcoind has wallet functionality built in. In fact, it was originally released as a desktop wallet for Microsoft Windows. By default, bitcoind will pre-generate a pool of 100 pairs of addresses and corresponding private keys. This pool will be increased as necessary.
This presents a number of problems. If data-loss were to occur on the server, the private keys could be unrecoverable and therefore the funds stored on the addresses would be unspendable. If a hacker gains access to the server they could copy the keys and steal the funds. The private keys can be encrypted, but the password is exposed on the server when generating new keys and spending funds.