Full information can be found here: http://forum.xda-developers.com/show....php?t=1207017
Basically this is a theme system where you make your theme following the above guidelines and update.zip method and then your theme can theoretically be applied on any phone and on any rom.
This should save you a heck of a lot of time in making different versions for different things, and also means that your theme can be used by a far wider range of people.
Please give a lot of consideration to using this.
When it first launched it had quite an impact, but however since then it seems to have been somewhat forgotten, and new themers have missed it altogether.