If you have been using Google Talk then you might have noticed that things changed today. Short answer you can use Buddy Images and Themes for the conversation window. But after looking around there are lots of other things that you can use GTalk for.

Not using GTalk? Give it a try, it is super clean and very easy to use.
First for all the latest on GTalk check out the blog: http://googletalk.blogspot.com/ this will give you the latest on the upgrade.
From the site:
Pictures. Now you can set your own picture and see your friends’ pictures, right from your friends list. It’s easy to use: simply click on your picture to select a new picture. In addition you can see the pictures in chat notifications, optional friend online notifications, and new Profile Cards that show up over your friends list. We think pictures are a big visual improvement to Google Talk, and we hope you like them as much as we do.
Chat Themes. Customize the look of your chat conversations by choosing from a number of built-in themes. Just select your theme from Settings->Appearances. One of the themes replicates the simple style, and some get quite fancy and include pictures of your friends.
I then was looking around and found this site http://www.customizetalk.com which has lots of cool little tweaks that you can make to GTalk and all the shortcuts etc.
The last thing that I found today is that with the latest Google Desktop you can have multi conversation with Gtalk people using a Sidebar. I looked at GD when it first came out and then at v2 but there has been a lot of work being done on v3 by 3rd party developers and I think that I might give it a shot again. One of the cool little items is TicTacToe thru with online friends. Now if that make a chess plugin that would be nice.
For all about Google Desktop head over to the site http://desktop.google.com.
Man I love Google.