It turns off the trigger for the key check.
This simply crack used to work, but Microsoft is now getting serious about stopping pirated software. Just today, Microsoft Watch stated "Come this fall, however, the Redmond software maker is planning to turn up the Genuine Advantage heat in two ways: By baking more Genuine Advantage checks directly into Windows Vista, and by taking aim at PC makers, system builders, Internet cafes and other sources of potentially pirated software."
YIKES! Maybe it's time to buy some Microsoft stock since no doubt MS will get a stock boost from many illigitimate users simply paying for a legitimate copy rather than play "tit for tat" with Microsoft, which keeps "tweaking" the WGA code to thwart users using pirated versions of Windows XP/2003 (and soon Vista).
But if your so inclined to play the "game" of hacking WGA and are looking for other methods of cracking Microsoft Windows Genuine Advantage (WGA) you can check out the plethora of comments below for various cracking methods. Good luck!