This device is a digital reclocker designed to reduce "jitter", which is a digital timing error, and a topic I don't know enough about to expound technically to anyone's benefit. It's an easy enough search to find more info (just search the forum archives for "jitter").
I used one of these units with a Bel Canto DAC 1.1 and Rega Planet 2000, and it improved the sound slightly but noticeably and favorably - quieter background, better dynamics, more detail. One drawback with using a jitter reducer like this is the need for an extra digital cable, which if you're using high-end digital cables, can be an additional expense of some note.
I ended up selling my ultra jitterbug when I moved up to a single-box player of higher performance (Rega Jupiter 2000).
The Ultra Jitterbug is only of use in conjunction with an outboard DAC, mainly for redbook audio (ie. cd-player digital output at 44.1khz) or with any device like a computer or DAT deck that outputs a 44.1khz or 48khz signal... it may also support one or two lower bitrates, but I don't know what those would be for. You can't pass SACD, AC-3, DTS, Dolby Digital, DVD-A or any such signals through it.
Hope that shines a little light, no pun intended. It's a good unit for use with the great variety of redbook-audio digital sources (CD) + outboard DACs that can be had for up to about $1k or so used (total for CD player + DAC). At $1k or so on upward, a nice single-box player will equal or outperform the lower cost CDP + lower cost DAC + jitterbug combo, and eliminate lots of cabling and their associated costs as well. That's my read on it.