Basically, the LiveScribe is a magic pen that records your notes as you write them. What makes it really cool is the built in audio recorder. So, you record the audio portion of a lecture and then the pen syncs your written notes with the recorded audio. Later you can place your pen at a point in your notes and you hear the audio from that part of the lecture. Totally cool. But it gets better.
You can dump the files to your computer for viewing/archiving but you can also upload them to the internet for your students to view. The embedable files work just like the notebook. You see ghosted writing you can watch the notes being written as a flash movie from the beginning or click around to jump to specific points in the lecture. The pen comes with either 1GB of memory for $129, or 2GB of memory for $169.
So far I've been having a student in each class use my pen to take notes (a different one each leacture). These notes are then uploaded to the net. I may also use it to quickly work some example problems to help students with homework or to prepare for tests. Below is an example of it in action.