PK2-editing just edits the stuff that you see on your side of the computer.
For example, you could change a L8 sword to look like a L64 sword, or a SoS weapon to look like a SoSun. You can even modify buffs - you can turn the first book of the fire buff to look like the 3rd book.
In the end, however, whatever you change can only be seen on your screen. People on another computer that don't have the same PK2-edits as you do, still see that L8 sword that you might have edited on your side. You can't make yourself do more damage. You can't make yourself stronger. It just changes the appearances and looks of things, is all.
If you want to get started, try this Guide:
http://www.silkroadforums.com/viewtopic.php?t=30876
It's the one that I started out with, when I started PK2-editing, and it makes things very nice and clear for you. Very easy to follow, and to understand.
Note that there is a SLIGHT risk that you could get banned for PK2-editing. JM hasn't said anything official about it yet, but MorningDew has stated something about not doing it.
Good luck!
