Justin, the "rewards" on the right are what you buy. If the project meets its funding criteria, you'll receive the item, presumably, on its estimated delivery date (located below that reward).
Example: If you pledge $550 and the project meets its funding goal, you get the $550 reward.
Kickstarter makes perfect sense for some forays, and not so much for others. As has been stated, I think that for a physical product, kickstarter makes much more sense than a washed up musical artist begging for $50,000 from fans so they can record and press a few CDs.
Kickstarter is also kind of a nice way to do "market research." A company can send out a letter, an email, post something to a blog, tap distributors for feedback or information, or ping outdoor shops and ask what customers are looking for. They might get a hundred different needs/wants and as they start brainstorming a product (prior to R&D), they might have 5,000 people saying, "I'd purchase the bag you're proposing," but then only 100 people would actually buy it--it's a gamble, and kickstarter funding, in theory, removes that gamble (at least for the manufacturer). It's an ideal model for smaller companies to use; even larger companies are turning to kickstarter, because direct-to-consumer models are better for everyone involved than traditional business models.
The direct-to-consumer model makes people put their money where their mouth is. Whether or not kickstarter is a good thing for startups, or a recipe for nightmares is another issue altogether. You have to have faith that the product you're backing is extremely well thought out and refined enough to the point where you're not paying to be a guinea pig.