This is one of the most important additions to the EOS 50D. What it allows you to do is to adjust the position at which the lens thinks focus is perfect. It's a 40 step scale from +20 to -20 "units". Canon don't specify what the units are, but the steps are small enough to finely tune focus. For a number of users complaining about front and back focus, this feature would be invaluable.
It can be set in two ways. First you can apply a constant offset to all lenses. This would be useful if the camera body was slightly out of adjustment, and it applies the same amount of correction to all lenses. In the second mode you can record the offset for each specific Canon lens (data for up to 20 different lenses may be stored). The camera recognizes Canon lenses and can record the off set based on the lens type. So, for example, you could record a specific offset for a 50/1/4, a 50/1.8, a 24-105/4L and a 70-200/2.8L. The camera would recognize which lens was mounted and apply the focus correction which you had set for it. What it can't do is distinguish between two different lenses of the same type, so if you owned two EF 100/2 lenses, the same focus adjustment would be applied to both.
For a while now Canon have provided the ability to correct vignetting during RAW conversion using Canon's DPP software. The required correction is stored in a database and applied on a lens by lens basis when one of the database lenses is used. In the EOS 50D Canon have extended this facility to apply the correction in the camera to images saved as JPEGs. While more extensive correction and greater control is available via DPP, the in-camera correction can nevertheless do a pretty good job if you prefer to save spec and effort by shooting JPEGs rather than RAW images.
With the EOS 40D in Live View, to autofocus the mirror has to drop and the camera uses its normal phase detection AF circuitry, which is fast and very accurate. The EOS 50D adds a contrast detection AF mode, which bases AF on the image as recorded by the sensor. This means that the LCD image doesn't black out (since the mirror stays locked up). The downside is that contrast detection AF can be slow and it may take several seconds to get focus.
While using contrast detection AF, the 50D can also analyze the Live View image for human faces and then optimize focus and exposure for them. If more than one face is detected, you can select which one to optimize for.
Some CompactFlash memory cards support UDAM access. UDMA is Ultra Direct Memory Access and it's a faster interface then the "normal" CF interface. For it to work, both the card and the camera must support the UDMA data transfer protocol and the EOS 50D does (the EOS 40D didn't). This means that if you use a fast card with UDMA support, data transfer with the EOS 50D is faster than with the 40D. In turn, along with the faster DIGIC IV processor of the 50D, this means that there is more room in the memory buffer so you can shoot more continuous images at high speed before the camera slows down. The chart below shows the improvement in buffer size (in yellow) when shooting JPEGs with a UDMA enabled CF card
As you can see, buffer capacity can increase by 2x to 3x or more with a UDMA enabled card when shooting JPEGs (vaules are highlighted in yellow), but there's no change when shooting in RAW or RAW+JPEG modes.