Spotlight is much more than just the visible UI shown during Jobss keynote: the vibrant blue search field in the top-right corner of the screen, and accompanying search results window. Thats Spotlight, the user-visible keynote-demo-able front-end.
Under-the-hood, however, Spotlight is also a set of APIs accessible by third-party developers. Its an entirely new metadata database not replacing the existing HFS+ file system, but instead built on top of it.
One implication of Spotlights file-centricity is that its ability to search email might not apply to clients other than Apple Mail its the fact that the new Tiger version of Mail stores each message as a separate file that allows Spotlight to effectively return individual mail messages as search results. No other major mail client uses a one-message-per-file storage format.
Whats cool about this architecture is that Spotlights indexes will thus stay up-to-date automatically. All you need to do is save, move, or copy a file, and Spotlights metadata and content indexes will note the changes on-the-fly. Compare and contrast to the full-content file searching previously provided via Sherlock, which required periodic monolithic re-indexing of the content of your drives.