Hey TomDeGarcia,
Podfarm is the software bundled with a Pod xt and either needs the device to work (like a giant iLok key) or an Ilok key.
The sound's exactly the same, only the the rack is supposed to relieve some pressure of the processor and of course you can gig with it. There's bucket loads of sound samples and opinions about the pod on this forum.
IR's are Impulse Responses - in simple words you run a full frequency signal through a let's say cab and then turn that into an IR you can use on your own files. It's like capturing ambience&eq characteristics. Check out McDsp, they've got ample info on their site and of course you'll find more than you can ask for right here - just run a search, there's tons.
Hope this helps,
akarawd