A thermal expansion valve is the part of the system that allows refridgerant to flow thru the system at a rate that allows it to accomplish heat exchange and turn to a gas before it gets to the compressor. Without some sort of control, such as a TXV, the refridgerant would flow so fast that all of it would not evaporate, causing liquid refridgerant to get to the compressor and destroy the compressor.
It works by opening and closing a valve that allows the refridgerant to pass by it at a rate that will get the optimum heat exchange in the evaporator coil without letting unevaporated refridgerant passing thru to the compressor. The pressure of the liquid refridgerant turning to gas is what opens and closes the valve. i.e. "thermal expansion" valve. Other systems use different methods to accomplish the same thing. A TXV is usually only found on large systems designed to have a heat exchange of more than 15,000 BTU's per hour. Most small chillers do not use a TXV. Most small window style AC units do not use a TXV.
You can put a TXV in any system as long as it is matched to the system. A TXV is the most efficient way of accomplishing this.
All large AC and Refridgeration units have a TXV.
Dave