It adds some extra folders into the kindle's directory structure, then allows you to add your own screen savers to it, you can just put the files in place and then do a restart.
I think it also gives you access to some built in games, but they aren't very good, and the kindle games pack (which I stupidly bought) is only about 99p
I did it some while back, just to get better screen savers, I have copied a load of the ones in your link and added them, but I haven't seen them come up yet.
*runs off to check his kindle*
Yay, they are on there, but they are slightly too small so I get a border with them. It isn't a problem on some, but I took one that had a black screen with Batman in the corner and it would look so much better without the white border.
There are instructions how to do it here
http://www.howtogeek.com/howto/3742...le-for-dead-simple-screensaver-customization/
I think it can vary depending on which kindle you have. What is cool, though, is that if you can edit pictures yourself you could have a picture of your love one, as long as it is black and white and the correct size (and orientation - I made that mistake with a pic of the ISS) and correct format you should be able to use it.