Question

What do they do? Do they have a purpose other than battling?

Answer 1

There are 28 Unown in all - one for each letter of the alphabet, plus ? and ! characters.

They don't really have a use in the game, they are quite weak at battling and can only learn Hidden Power anyway. Their inclusion is more about the mythology behind them.

Answer 2

if you catch all kinds of unknown except ? and ! go into the mountain through the passage way south of veilston city you will find that it is deeper than normal go to the end then out through a passage to the south and you will see a pokeball in front of you pick it up and it is a rare candy