It runs via an exploit found about a year ago in WebKit [1] , and allows running custom code. It does not enable piracy, as that would require greater system access. It allows running simple applications, with severe limitations (can't use native video out or controllers; workarounds employed are using an HTML Canvas for visual output and a Nintendo DS for control).

It is a very basic SDK right now, it is still in development and has a long way to go. Considering the exploit to run code only works on FW 1.76 (~1 year old), there presumably aren't many people able to run code anyway.

[1] http://wololo.net/2014/10/24/webkit-exploit-confirmed-to-run...