the biggest thing it does is allows for active encoding of non ps3 supported video files to allow streaming across the network. it also lets you copy stuff from your network computer to the ps3 and will do an encode if it needs too.
also red kawa makes a video conversion program that will convert to ps3. i haven't had much luck with hd quality stuff, but i haven't tried it in a while. they may have updated the software. also. xvid4pspmight do some encoding for ps3. i know it is geared for psp owners, but i believe they added support for ps3 video files as well. i used xvid4psp
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