Hi, janellemda!
WiFi is a radio signal based networking system that allows you to connect your computer (be it desktop, laptop, or Pocket version) to a local area network. As you drive around, your MDA is detecting that there are WiFi routers available... some are protected against unauthorized access, and others aren't (we call these last ones "open" networks)...
Your MDA (and mine) have been programmed to try to access any and all WiFi signals they detect... when you say "yes" to their question of whether or not to access the WiFi, they try to connect, and if it's an open network, they'll do so.
So now you are connected to a network... if that network has unprotected computers on it, you could actually look at their files... if the network is connected to the Internet directly, you can use the Internet connection as if it were your own...
In my college, the WiFi is password protected, and they don't allow you to snoop in the computers... but Internet is available and free!
In my house, the WiFi signal is encrypted, and you need a special, long, password for the router... can the encryption be broken? sure, if you really want to invest a lot of effort into it... but in general, it's pretty good security.
My school, though, doesn't use encryption... it simply requires the computer to be pre-approved as a network user in order to allow the connection.... a better security system that Win 98 computers can't work with... (this is coordinated by the network manager).
My brother, on the other hand, is paranoid about security, so he used a 128 bit password, as well as the authorized user system, before wiring his house for Ethernet and eliminating WiFi... :-/
Good luck, and let us know how it goes!
Manny