I haven't tried this specific site and have no intention to do so, but it appears based on how-tos and screenshots that they are using some variation of the Enterprise Distribution Profile. (Though I'm not sure how they avoid UDID registration. It may have something to do with the notion of the requirement to roll your device's date back?)
Installing such an app looks like this, from this article which explains how to use it to distribute beta apps:
Installing an app in this fashion, which I understand is a violation of Apple's developer policies if done to publicly distribute an application, does not require you to go through the App Store. However, by doing so, you're explicitly circumventing Apple's vetting and, in my opinion, increasing your risk. I recommend avoiding such downloads except in the context of internal enterprise software distribution or beta testing with a developer.