Polygons > Unfold UVs. The unfold function will flatten out your UV texture for you. If you take a look at your 3D model again, you should see that the square texture is evenly displayed all round this section without stretching which is one main goal we are trying to achieve. This is what the unfold function does for us.
However, we still want the flat UV map to look like the place where it came from on the 3D model so that it will be easy and intuitive to paint the texture for that section. When you first unfold the hand (for example) you will probably get a result that doesn't look much like a normal hand, so although it appears flat on the 3D model, you can't really use it to paint a texture map
We need to reshape the UV map into a recognisable hand shape but still have the texture appear evenly on the 3D model. To do this, we select some key extremity UV points, one at a time (like the ends of the fingers/thumb and base corners of the palm) and shift them to where we think they should be. We then select all the other points (not any of the points we just moved) and select Polygons > Unfold UVs. By not selecting our key extremity points, we are telling the computer not to shift them. By unfolding all the rest, we are telling the computer to shift these points around to fit the new structure but because we are using the unfold function, it will unfold to a proportionately correct position to give an even texture covering.
Our other goal we are trying to achieve is to avoid the UV coordinates being overlapped. This tends to be a little difficult with each of the fingers in the hand, so we try to move outer fingers (pointer and little finger) out further to give more room for the inner fingers to avoid the overlap problem between each finger. We do this by repeating the above procedure of moving the extremity points and unfolding the inner points again. We keep repeating this until we have a shape that we are happy with.