Considering you can use the trackpad to move a mouse pointer or hook up a USB mouse I"m guessing it's their custom UI overlay to allow these types of functions to work.
I have to admit, I think my Xoom will be hitting the store shelves again soon. I have a week or so to return it and from what I've seen in the Asus Transformer I'm getting pretty damn excited to see an IPS screen and a quick attaching Keyboard setup like this. IF the tablet alone is $399 for a 16gig version, that a steal imo. Grab a 32gig SD card and with USB support.. this is a no brainer for me. Feels like christmas in April.. or first of June
