QEMU is an x86 emulator. Not like DosBox which emulates the DOS system, but a complete x86 barebones emulator with the ability to translate applications on the fly. You can use it as a virtual machine and install a completely different operating system onto it, or use it in user mode where it can load an application and translate it's code on the fly. It'd be especially useful for running x86 Linux games and applications on the Pandora.
In that way, in theory, QEMU can "run" WINE and translate the Windows system calls into Linux system calls. Together, they make it possible to run Windows games on the Pandora. A proof of concept was already created, and it was slooooooow, but it worked kind of.
WINE+QEMU is often brought up in the "Pandora cannot run Windows" threads as a suggestion of how the Pandora *could* run Windows games, but the consensus is that it will never be fast enough to play the games the people asking if it can run Windows (or WINE) want to play (ie, World of Warcraft, or any other game made since WinXP) so it's usually downplayed in those threads.
With WINE+QEMU, we might expect some Win95 era games to play, maybe, eventually. I wouldn't expect much more beyond that but I've got nothing but gut instinct to really back that up.
edit: wrote too much
h34r: