Its a disc for devkit boxes to return to their original state.
it will
a) reformat HDD
b ) reinstall the debug or retail dash version that u choose
c) reprogram EEPROM in debug form
d) might give you the option to flash the BIOS
doing (c ) will stop retail BIOSs working if u have not embedded EEPROM
doing (d) will stop any retail Xbox working
edit: omg who is the idiot that decided

and © where smilies?