Yes, plug and play. (usually a quick delay while the computer initializes and starts the 2nd display for the 1st time)
You can use mirror mode, so both displays are clones of each other.
You can use single display (say you have a laptop and want to close the lid).
Then you can have an extended desktop, so you'll be having a larger real-estate. In the preference pane for monitors - you can adjust where the 2nd display is "located" - so moving the mouse to the 2nd screen is a logical thing. (if the display is to the right, move the mouse off the far right corner of screen 1 and it automatically jumps to screen 2)
The resolution can also be independent of the primary display. (so you can have one at 1920 x 1200 and the other at 1024 x 768, or what have you) Bear in mind, the highest resolution supported is the "native resolution" for the monitor. (you can go lower, but not higher) An LCD screen will always look sharpest at the native resolution. (they get fuzzy and less defined and lower resolutions)
That help any?