For example, I run iTunes (here's how) directly on the device, control it via my iPhone, and stream the output to my living room or kitchen with an Airport Express. This has the advantage that it works even if my Macbook is sleeping on battery power. Going the other way, HP has a free iPhone app that can stream media stored on the device over the Internet to my phone, wherever I am -- including over 3G, although the quality of video over 3G makes early YouTube look palatable.
Even better, it is where my Time Machine backups live. My Macbook streams backups to it hourly, just as if it were a Time Capsule, but unlike Apple's device my backup is redundantly stored on multiple hard disks. If a disk fails in the MediaSmart my data is fully protected, unlike in a Time Capsule. That's probably not incredibly important to everyone, but I'm a backup nerd. Knowing my file edit and delete history is itself protected against hardware failure gives me the warm fuzzies. This bit only works because of software HP has added, but it sounds as though Microsoft is moving that capability into the base OS in the future, so more Windows Home Server vendors will be able to offer it.
As you'd expect from a modern storage device, it's essentially unlimited in expansion options. Between four SATA drive bays, three USB ports, and an extra eSATA jack, I could upgrade to well over 20TB if I felt the need and was willing to tolerate the clutter of external hard disks. The lack of disk expansion options in anything other than the Mac Pro is something that bothers me about Apple's product lineup.
Many Mac owners trying to solve problems like these gravitate to a Drobo instead. At the time I bought the MediaSmart, they only offered the dumb USB/Firewire storage-only models. I don't own any always-on desktop Macs so I was actively looking for something that could act as a server as well as a file store. The new Drobo FS has some limited ability to run server tasks, but the support from third parties is not as broad as Microsoft's offering. You can't run iTunes on it, for example.
There are a few things my little HP does badly, such as run Air Video Server. My unit doesn't have enough CPU horsepower to stream videos with live conversion to my iPad, although HP does offer more powerful models. Overall though I've been very happy with my MediaSmart. I applaud HP's strong Mac support with what (on the face of it) should be a very Windows-centric device, and I'll be happy to see Microsoft's Windows Home Server team support Macs as first-class clients in future releases.