I hear the freerolls pop up every 5 minutes or so, but they fill in 5 seconds. So you have to wait for them, jump-in, and register ASAP.
When you win round #1 you get to play in round #2. When you win round #2 you get to play in round #3. I think they give you 10k points, so you can cash those out *or* play.
If you win it all, you get $20,000 buy-in for the televised Poker After Dark TV show. It's a 6-seater, winner-take-all tournament that airs late at night on NBC. You give Full Tilt a list of ten professionals you'd like to play against and they get 5 of them to play against you.
I've seen two Full Tilt amateurs make the show. Neither one was able to win.