Our play session was pre-arranged, but once the game ships players will be able to choose whether their games are open or invite-only, with various sub-settings to limit fields like level range. Gearbox confirmed that co-op will take advantage of dynamic difficulty scaling; the more players (up to four), the tougher the enemies.
We cheated a bit to upgrade the abilities of our character -- Mordecai, the sniper -- for the limited amount of time we had, but, in the "real" game, the character you take into a co-op game will be your character from single-player, complete with the same items, weapons and stats. Our team consisted of two snipers, a "siren" (Lilith) and Brick, the game's tank character.
As we said, the overall idea is that Borderland's co-op is the campaign with other players. For the event, we were dropped into an area packed with enemies and had to work together to survive. Of course, we could also horde any loot, items and weapons we found. (But we'd never do that!) In fact, if we had been feeling especially generous, we could have given items or weapons to the other players, or even worked out a trade.
The action was a little too intense for any of that, though. The goal was simple -- shoot to kill; we weren't working on an objective -- but actually surviving wasn't so easy. We all had to rely on each others' unique skills to get through. It turned out that Roland (the soldier) and his shielded turret provided much-needed cover for those low on health. As in Left 4 Dead, we could use any health packs we had to revive downed comrades, and, if we went down, could still shoot (albeit with limited range of movement) until help arrived or we bled out.
After an initially overwhelming initiation to co-op, it became deeply strategic and, frankly, really fun. There's no questioning that online co-op isn't a tacked-on, separate experience. Whatever you gain playing in someone else's game you take back into your solo adventure: XP, cash, weapons, items. Borderlands alone is a unique FPS ... er, "RPS" game, and its co-op element only makes it stand out more from the rest of of the dwindling fall lineup.