Davy they are programs that allow you to play chess, find best moves etc. Can be educational - but highly illegal to use while playing a game at chess.com!!
What's a Chess Engine?

Is that Charlie Sheen talking? :-) Now i have to look up GUI. I plan on taking a trip and won't have access to internet, so I ordered Fritz . . . It'll be great on the plane and away from home. Thanks all.

If you ordered fritz 12, your GUI (graphical user interface) will be that of Fritz. Basically, its juts a GUI and you can also install more engines like Houdini onto that Fritz GUI.
Basically the engine will tell you what the best moves are and stuff. It won't tell you why you missed what you missed or what went wrong in your thought process, etc.
Once you get your fritz and turn it on you will see numbers and symbols. Positive #s favour white, negatives favor Black normally. +/= means white is slightly better, +/- means white is much better, not quite decisive, +- means white is winning. =/+ means Black is slightly better -/+, -+ etc etc. The number is how much it thinks you are "winning" by and doesn't have to be an integer when it comes to engines. They evaluate in terms of centipawns. The symbols are directly related to the numerical values.

Oh great. Thanks Lava.
Wonder what rating Fritz 12 has? More than I need but was curious.
edit: OMG, it said it has a rating of 3088! - and I paid about $12 for it. Better than Kasparov and Carlsen by almost 300 pts.

Well, just like chess.com ratings can't be compared to FIDE ratings, you have to remember these are also not FIDE ratings. While they're certainly stronger than human players, the rating is based off computer tournaments where, I've been told anyway, that the ratings get a bit inflated as compared to FIDE ratings.

Okay, thanks Waffle. Still that's amazing one can buy such a strong program for a lousy $12. Which begs the question - remember, i'm fairly new to chess and play in my first OTB tourny next month - how do FIDE or USCF ratings compare to ours here? I read it somewhere here, that chess.com ratings are about 200 pts higher than, say, USCF? Is that about right?

Yes, it is amazing! People all over the world can have access to GM level analysis... not that the computer is accurate in every position (it's opening and endgame databases help cover those soft points) but still it's a great help in suggesting very strong moves that we may not have considered when left to ourselves.
---------------
About the ratings, statistically speaking... or maybe I should say, for the most part, online ratings are higher, bullet and standard ratings are a bit higher, and your blitz rating is the closest.
Individual results vary for different reasons... mostly because they're different ratings lol :) But also some people simply can't play fast, and do much better in long games. Some people can only play fast and do terrible in long games. Some people take online games very seriously, and some people get nervous and have trouble focusing in OTB tournament play.

does any one know the difference this poster paid $12.00 for a Fritz program, and I see one for $119.00 is there some thing more in this expensive program and what? I almost bought it!

Davy,
This article is old but it is still relevant, informative and still a good read:
http://www.chessbase.com/support/support.asp?pid=213
Sorry, I'm only 5 months old chess player. All this talk about chess engines. What is it exactly? Is Houdini a chess engine? Is that just a computer program that plays chess? I just ordered Fritz 12, is that a chess engine? Do chess engines help your game by showing you what you COULD play?
Thanks.