Does anybody know how to use the .rss or .xml feeds of vbulletin
I need to figure out how to a) turn it on, b) use it and c) tell my members!

give meyour experince

vBulletin Options > External Data Provider

to access it simply link to www.yourforum.com/external.php
also add the following to your headinclude template:
<link rel="alternate" type="application/rss+xml" title="RSS Feed" href="http://www.yourforum.com/external.php" />