In order to understand how Incarnum works, there are three main concepts to grasp.
Essentia is a pool of magic energy which some characters have. Essentia is a bit like Power Points (see XPH), but whereas PP or spells are expended when used, essentia is not. Instead, it's "invested" in various features, powering them up.
If you like, you can thing of it like a power source which is constantly renewing, like on Star Trek when they divert power from the engines to the shields, but they still have the same amount of power overall (OK, lame analogy).
You can move your essentia around as a swift action. This means you can have it sitting in a defensive feature and move it to a more offensive one when needed. You only get one swift action per round, of course, so how you spread your essentia still matters.
The amount of essentia you can put into any one feature at once is limited by your total character level (not your meldshaper level). You can also raise this cap with certain feats or features.
A lot of (well, not lots, but some) races and classes get essentia. There are also plenty of feats which give essentia and uses for it.
However, what Meldshapers (Incarnates, Soulborn and Totemists) get which makes them different is Soulmelds.
Each day, these classes may shape a small number of Soulmelds, which are enhancements to their character. If you are familiar with the Binder (Tome of Magic), it's like binding a vestige. If you are familiar with the Chameleon (Races of Destiny), it's also like how that class can change his bonus feat each day. If not, think of it a bit like memorising spells, only they're not spells which you can expend, they're things which give you a bonus all day long.
Each Soulmeld occupies a position on the body called a "chakra" (see Chakras). At this stage, the only thing which matters is that two soulmelds can't occupy the same chakra. Thus, you can't shape the Acrobat Boots and the Airstep Sandals at the same time. Since many soulmelds can occupy one of a selection of chakras, however, you may be able to move one to fit in another.
One their own, soulmelds usually provide a minor feature - for example, the Basilisk Mask grants you low-light vision. However, you can invest essentia into them to make them more powerful; the Basilisk Mask gives Darkvision with a range of 30ft per point invested. Thus, if I invested 3 point of essentia in my Basilisk Mask, I would get Darkvision to a range of 90ft.
As mentioned above, each soulmeld must occupy a "chakra", a space on the body much like the slots you can wear magic items in; in fact, each chakra has an associated slot. At first, the only thing you need to worry about is not being able to put two soulmelds in one chakra. However, Meldshapers soon get a third feature - Chakra Binds.
Chakra Binds allow you to "power up" or focus in a specific soulmeld. Both the Totemist and Incarnate each get one chakra bind at L2. This lets them bind a soulmeld to the space on the body, causing it to become more real (read: more powerful), much like an actual magic item.
Each Meldshaper only gets access to certain chakras at certain times. The Incarnate, for example, gets only the Crown chakra at L2, limiting his options for binding to only five soulmelds. At L4, the Incarnate also gets access to the Feet and Hands chakras, but can still only bind one soulmeld. Thus, Bill would be able to bind the Diadem of Purelight to his Crown, the Acrobat Boots to his feet, or the Bloodwar Gauntlets to his feet - but only one of those.
Chakra binds also have an additional limitation. When you bind a soulmeld, it effectively becomes a magic item. As such, you can't wear another magic item in that slot without the Split Chakra feat. This means Meldshapers need to think carefully before buying their magical gear.
Notes and Oddities
Some things to remember:
- Your essentia is limited by character level
- Essentia from all sources stacks. Thus, a Totemist 19/Incarnate 1 could still fill up an Incarnate soulmeld with his Totemist essentia.
- Soulmelds, chakras and binds are not shared between classes. The Totemist 19/Incarnate 1 would have access to the Crown chakra, but only for his Totemist melds, not his Incarnate ones.
- Totemists get a special chakra, the Totem Chakra. A soulmeld can't occupy the Totem Chakra, so it must occupy a different space. However, it can be bound to the Totem Chakra, providing an alternative (and usually more powerful) ability.
- The only book aside from Magic of Incarnum with soulmelds in is Dragon Magic. There is a Mind's Eye article which also provides a small number of Psionic-related soulmelds.