From BlenderWiki
About
'Mesh Modifier' is modifier that deforms the owner mesh by the target mesh.
The advantage(s) of this modifier are that you can use a low poly mesh to do simulations, animating visually on, and then easily transfer the data onto a high-poly, 'beauty' model which gets rendered without you having to set up shape keys, etc again. This reduces the recalc time needed (hopefully), with not so many sets of data having to be deformed the same way for each frame.
An Implementation?
[EDIT] information that used to be here has now been removed... Brecht has coded this in svn.
