To answer all the 'what the heck is this?' questions...

I think what this does it basically give the admin the chance to make urls that redirect to other pages. Sort of like AOL keywords.

It may be useful if you were running, for example, a dictionary site or glossary and the user types /go/dog and then that would redirect to a forum search with all posts about dogs?

lol.

I have the same problem: I have vbseo installed, I tried to install this hack but don't works. I have the forum in site.ext/forum/ and I added this code at .htaccess After add some keywords in admin panel, I see that nothing changed in threads
Is a conflict with vbseo?

This hack does not change anything in threads. It simply allows you to use those links, but you have to add the links in templates yourself.

Can external links be used as well? Also, I have mine in a subdirectory as well, did the edit above, and still doesnt work for me either.

Yes, you can use any links.
As for subdirectories - see .htaccess commentary added by this hack.

RewriteRule ^go/(.*)$ community/keyword.php?keyword=$1

I have. And still no go.

The RewriteBase part is what you need.

Still no go.

RewriteBase /

RewriteRule ^go/(.*)$ community/keyword.php?keyword=$1

Try:

RewriteBase /community/
RewriteRule ^go/(.*)$ keyword.php?keyword=$1

Copied and pasted...and still nothing.

I have this in my forum subfolder (which is 'community'). I have tested it numerous times and still nothing even though I have entered the info as stated and everything shows in the admincp. The forums do not reflect any changes and no keywords are highlighted or anything else.