It includes all the stuff you elect to put on your iDisk, which includes web content linked to the .Mac webpages, like photos. So, if you use Apple's templates, they don't count but if you upload Dreamweaver templates, they do.
Similarly, files you put up to share with your website's downloads page count as well.
It doesn't include you mail account (separate storage amount of 15MB or whatever if you have more than one) nor does it include what Apple puts there. So not included are SW downloads or updates that appear on your iDisk from Apple.
If you do a "Get Info" on your iDisk when it's mounted on your desktop, the data under:
Available; and ...
... will show the amounts you have elected to add and what is available for additional files.