Kerberos is a security protocol that has been implemented in windows.

It is something that you need to get to work if you ever have a windows process that wants to perform an action on a users behalf under that users identity.  It is a bit of a pig to configure.  The only clue that you get is that the remote service is accessed using the Unknown User

Here is an article on enabling Kerberos.

Here is a Microsoft article on troubleshooting Kerberos under IIS.

Here is an article on the BDC and authentication.  The BDC is the expensive version of Sharepoint’s datasource abstraction layer (i.e. it can read from a system that supports .net 2 drivers or has a web service interface).

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