The audio source in question can be any Bluetooth-enabled smartphone (iPhone, Android, Windows Phone, BlackBerry), most tablets (yes on iPad, no on Nook Tablet and Kindle Fire), later versions of the iPod Touch, or many PCs, Macs, and laptops.
Once you've connected the adapter to your stereo's input with the included cable, you then just have to pair the adapter with your Bluetooth-enabled device. A "connect" button on top of the unit puts the adapter into pairing mode, and I was able to pair an iPhone 4S as well as an Android tablet without any trouble.
Once connected, your smartphone or tablet can act as a remote and you can stream music or other audio to the speaker while maintaining control of volume and track selection from the palm of your hand. In other words, you can sit on the sofa and choose to play any music file, app, or browser-based audio from these devices (including Pandora, SiriusXM, MOG, and iTunes) and have it wirelessly emanate from your stereo across the room -- no AirPlay or Wi-Fi necessary. Range is about 30 feet but I managed to do a bit better than that.
Since Bluetooth is a wireless technology you may occasionally encounter some hiccups, especially if you're walking around with the phone and stray out of range. Also, sometimes your own body (or somebody else's body) can be a source of interference and may result in a dropout. But my music mostly streamed fine over the course of a day's listening time in my office.
As for performance, Bluetooth compresses audio files, so you're not going to get sound that's quite as good as you'd get from Apple's AirPlay wireless streaming, which uses Wi-Fi technology and doesn't compress files. Bluetooth has a tendency to flatten things out a bit, so you might notice your music doesn't sound as dynamic as it should, especially if you're streaming to better speakers (if the speakers are only OK, you won't notice much of a difference).
That's really it. In short, the Logitech Wireless Adapter does a perfectly decent job of what it's intended to do. There's nothing particularly "wow" about it, but it's priced well enough at right around $40 and I have no problem recommending it to anyone looking for a relatively inexpensive way to turn a wired stereo into a wireless one.