The idea is to have just one box to do it all. Instead of having to hook up a laptop to your tv or switch from your PS3 to cable box you'll be able to do it all from the one box. (Even though with most providers you'll still need your cable box near the Google TV box.)
The idea is to make it where you can access web content along with your cable content seamlessly. To get a really simple explanation check out this
link on YouTube.
I'd add that Google TV includes the Google Chrome web browser, a basic set of Android applications (appointment book, calender, text editor, Skype, etc.) and Android applications can run on a device that contains Google TV. Beyond that Google is releasing free APIs so that web site developers can produce web sites that
look good when displayed on a TV.
RE; Android, an Android application can look up local weather, movies, news, traffic conditions or one can control your home theater devices; it can run when you load a DVD (closes curtains, turns down lights, starts the popcorn maker, etc.)
Want a map to a store in town, Google maps will probably be interfaced into Google TV with APIs to make it
look good on a TV. See it now?
Do as suggested, pay attention to the
required hardware (1080P+ A/V display, keyboard/mouse, LAN or WIFI, IR blaster and Video input from set top box, camera, Bluetooth, microphone and think voice recognition and gesture control) then search for the Android toolkit and look at the included Android applications. Remember also that Android applications unless device specific can be run on ALL devices that support Android or Google TV. So for example, an Android application that looks up local weather will work on ALL devices.