Mike V: Isn't it great? That's Guy English's work - see his post for full information on it:

http://www.rogueamoeba.com/utm/2008/02/21/your-screen-on-a-screen-on-screen/

Mister Snitch: Lots of people want to send unsupported video formats to the Apple TV, sure. But that's not really what Airfoil is about. Heck, that's not at all what Airfoil is about. The AirTunes functionality on the Apple TV means its set to receive audio, over an audio protocol. It doesn't open it up to receiving video from another source, in other formats. While I'd love to see this too, it's nothing we'll be enabling with Airfoil.