It enables a wide range of extra functionality which is missing from the official firmware, such as bittorrent, webserver, NZB, SSH, FTP, NFS, etc.
I then tried to hop on my neighbor’s Wi-Fi to see if I could see my drive.
As indicated here and by bmdixon, you have to flash the /system and /boot partition from you stock package, because these ones usually get modified when rooting your device.
Afterwards the OTA update works fine (working for 5.1.1 from 5.1.0).
It does not, however, enable dual-band networking or guest networking on older devices as that feature relies on the new hardware found in the Early 2009 versions of the Airport Extreme and Time Capsule.
Airport Express users get no love (beyond bug fixes) as Air Disk sharing is not supported on those devices.