the difference is that whith this hack yuo can link your avatar from external web...
example:
you have this immage's link:
www.geocities.com/iimage.gif
you put the link and not stored the file in database(vbulettin without hack) and not stored immage in your server (vbulletin with Cocomail or Kier hack)...
but it show immage from its location. In this way your database (or your server) not load all avatars of your member.
It's the same way of ezboard or UBB... etc.
Ps. excuse for my english.