In recent weeks blogs running older versions of WordPress were exploited. If you’re concerned that your blog might have been broken into, download the plugin and run it. It will find false positive results but it will do a reasonably good job of finding the code that’s inserted into a hacked site.
The plugin works by scanning every directory on your site. This is done recursively which unfortunately takes up quite a bi of memory. If you get an out of memory error please read the readme.txt as it has a suggestion for fixing the problem.
PS. WordPress 2.8.5 was released last night. Make sure you upgrade! A WordPress MU release will follow shortly.