A friend of mine has one on his HTC Tilt from AT&T. This thing is awesome. No lag whatsoever, rarely any buffering (except maybe a little when changing channels?), just an overall great device and software. I haven't watched any TV through his PC, but I've played around with the mobile version a little bit.
There are currently 3 Slingbox devices on the market right now: Slingbox Solo - The basic setup that lets you watch all your TV shows on your computer/mobile device. Only lets you watch and connect one video source. (hence the name SOLO). Slingbox Pro - If you want to watch and connect up to four video sources, Slingbox Pro is for you. It also features an integrated analog tuner and HD component input. Slingbox HD - Top of the line Slingbox that lets you stream your HD channels if you have an HD receiver. It would be really cool to see how HD channels would look on your mobile phone. To find out more about each device, go to http://www.slingmedia.com/go/help-me-choose
There are a lot of video demonstrations of the Slingplayer software that lets you watch your TV channels on your phone. Here's a video demonstration on an AT&T Tilt. And another on the XV6800 (close enough to XV6900)
Hope that helps. If you have any questions feel free to PM me, and I'll try my best to answer them.
Edit: I missed your question about how it works. Here's the FAQ section of the Sling Media website.
What do I need to get started? 1. Broadband cable or DSL high-speed Internet connection (Minimum Upstream Network Speed of 256 kbps) 2. Home Network Router 3. If your TV cable connection is located in a different place than your Internet connection, you will also need a SlingLink or other Ethernet bridge 4. Windows PC or Mac computer 5. If you want to watch your TV on your phone, you need a Windows Mobile, Palm OS, or Symbian PDA or phone with a 3G data or WiFi connection
How do I set up the Slingbox? 1. Connect your TV/video source to the Slingbox 2. Connect the Slingbox to your network/router 3. Connect the Slingbox to a power outlet 4. Install the SlingPlayer software on your PC or Mac or compatible Mobile phone 5. You are now ready to watch your TV anywhere