See here: http://picobay.com/d...TV_Hacking_Wiki
Basically, they can be turned into full-fledged C64 clones, with internal headers for a keyboard, controllers and an IEC port for a floppy drive or whatnot.. The PAL model is a bit more compatible, and has the internal connections for two full-function controllers, keyboard, IEC port, cassette port, and userport. It also has flash memory which can be programmed to internally hold different games other than the original built-in ones.
The NTSC model only has connections for a keyboard, IEC port and a single controller port (and the controller port is missing the connection for the UP function!) It also has no flash memory, just a read-only ROM. But it is still fun to modify if you have a floppy drive and some old games.