Can we use a single cj affiliate code on multiple websites? If we can, then why is there an option of adding websites in the account settings? What is it for?
No, You need to add each site in account settings and select the specific code for the respective destination site. You need to show to your Affiliates where are you promoting them. If you decide to promote an affiliate on a undeclared site you will be Violating Your Publisher Service Agreement. The point first is that all clicks referred from this site will be reported to your account as invalid clicks and commissions from sales originated from these clicks will not be credit to your account. After a lot of clicks your account is flagged for Violating TOS: An CJ may contact you regarding this issue.