Basically Bluetooth is a method for 2 or more devices to talk to each other wirelessly. (It's not 'Wi-Fi' though)
So, that could be PC's, PDA's, cell phone, etc.
I've only used it once so far. A co-worker who also has a Bluetooth enabled iPaq can wirelessly beam me files from across the room. Very handy.
Another co-worker has a Bluetooth enabled cell-phone, which allowed him to beam his contact/phone number list to his iPaq. Cool.
I plan on buying a bluetooth receiver for my PC, which is a small USB device that will allow me to wirelessly sync my Outlook information, as well as have web/email access on my iPaq while I'm in the room. Extra cool.
Feel free to ask more questions if you've got em.