For non-jailbreakers, AirPlay mirroring will have to wait until iOS 5. We are getting very close to the launch of the new iPhone (what is an iPhone) along with iOS 5 for the iPad. Basically, when AirPlay mirroring is enabled you can see everything on your iPad on your HD TV. Videos, games, documents, and whatever can instantly be beamed from your iPad to your television.
Via Apple'n'Apps - Video walkthrough of AirPlay Mirroring on iPad 2 with iOS 5 Beta 6. This video attempts to show improvements since iOS 5 Beta 1.