To understand is to grasp, to receive a particular impression from an object, to let it work on one. To let the proposition work on one; to consider consequences of the proposition, to imagine them, etc.
What we call "understanding" is a psychological phenomenon that has a special connection with the phenomena of learning and using our human language.
Now a major problem with Wittgenstein is understanding which 'voices' are his own and which are those of an interlocutor, opponenent or 'intermediate self' (one where W is putting forward an instinctive view of his own ['I would like to say'] to be later refined.) I find that this is easier to work out in the Philosophical Investigations where his opponents views are more often than not put in quotation marks. In Philosophical Grammar, I am constantly wondering whether views in the regular flow of the text are his or not. However, that may be an artifact due to his thought being in a transitional phase.
Despite this, I have no reason to doubt that the above quotations are his views. Perhaps others may care to disagree. He here links psychology to 'learning' and 'use' which, as I said in the previous post, are crucial to understand later W's views. And the 'use' in 'using our human language' is not denoting what he sometimes calls 'use in language' or at least I think not. That is the use that is internal to the grammar of the language. Instead, it is looking at 'use' as part of 'what happens' in using our language. And these connections don't seem to place 'psychology' as some mysterious mental process. I approve!
However, my excitement at this quote slightly abated as I read on. He goes on with a long paragraph detailing why we shouldn't consider 'remembering' a meaning as 'seeing it in the mind's eye' (the usual stuff!) and then says the following:
The psychological process of understanding is in the same case as the aritmetical object Three. The word 'process' in the one case, and the word "object" in the other produce a false grammatical attitude to the word
Now this is the question as is often the case with Wittgenstein: is it wrong to call some concept x, or can it just have misleading consequences? It seems here that it is not wrong to call understand a psychological matter; it is just that we may take the false grammatical attitude (the emphasis on attitude is his, not mine). It is not necessarily wrong when used in connection with 'use'; it is only misleading when we misunderstand the grammar of 'understanding'.
If it does have misleading or confusing consequences, is there a way to use the same word without those misleading consequences? This is especially pertinent with regard to 'understanding and psychology': we are much more likely in every day language to call understanding a matter of psychology than we are to call 'three' an object. Whilst Wittgenstein will completely avoid using a term that he believes leads to confusion, this could be seen as overstatement on his part. Language that is confusing in one context can be perfectly clear in another.
The everpresent question: can we talk psychology without creating a myth of symbolism or psychology?