yup, short answer simple: Its a specific species of macroalgae.
as for it's appearance, fish wiz2, that's a personal opinion only, I don't grow mine in the fuge cause it's ugly or anything. In fact, it's one of the better looking macro agla out there (in my personal opinion). I won't grow it in the display portion of a tank due to the potential to make a mess if it's not doing well, plus it does not holdfast or root to anything, so in a dipslay, it'll float around till it snags on all the nice corals, irritating them in the process.
One reason you hear about cheato so often is that it really is one of the better Macro's for refugium purposes. It does not go assexual nearly as easily as many other forms of algae can, such as caulepra. It's also extremely fast growing so does it's job quiclky and effeciently. Very easy to trim. Also, gives pods a nice place to call home. Many larger speceis of pods, like the grammarus shrimps love clinging to stuff, weather it be bioballs or a ball of cheato,