This would allow for example applications running "in the cloud" (such as Amazon EC2, Rackspace or Google) that can use LDAP for authentication to use local AD (or any other LDAP server like DSEE or Novell) to use that authentication without needing to synchronize passwords.
Another option which is used by one of our customers is that they use SAML-based federation for authentication to a partner application. But the partner app uses OVD's DSML v2 support to query for attributes. Or if you prefer REST-style Web Services - OVD also supports a REST interface capable of returning either XML (either DSML or custom format) or even JSON. I'll put examples of that up in a later screencast.
You can watch the firewall screencast here.