If you push the recovery button while the S10 is off, it will power on and boot into it's own little OS which allows you to repair windows, restore from a backup, install a factory fresh install of Windows XP, or simply reboot the S10.
Try pressing the recovery button some time. You can always exit and reboot the machine without making any changes to it, and you will have a better understanding of what to do when you really need to use it. I played with this stuff as soon as I got my S10, because odds are, I'd need it sooner or later.
Somewhat off topic, but One Key Recovery only formats/backups the C: drive. Nothing is changed on the D: drive. The first thing I did with my S10 was to move the My Documents folder from the C: drive to the D: drive. That way if I ever need to reinstall the OS using One Key Recovery, everything in my documents will not get deleted. I highly recommend everyone do this.