Since we already got one "huh, what the heck", I guess I'm obliged to explain:
A C&R is a class 3 Federal Firearms Licence (a dealer is class 1) that allows one to legally aquire firearms that are condisered "Curios or Relics" via interstate commerce. For example as a C&R Licencee, I'm allowed to purchase a 1943 M1 Carbine from anybody who is legally allowed to sell one and have them ship it right to my home. I can also sell sell and ship said carbine to a class 01 FFL licencee or another class 03 licencee.
Another benefit of getting a C&R licence is you can purchase right from the wholesalers where dealers get their import stuff. Obviously, you get stuff at a great discout over dealer and gunshow price. Some parts warehouses give 03 FFL licencees discounts also.
The only caveats are, you can not buy to sell. All purchases must be for your own collection, although you can sell or trade off firearms you get tired of or ones that you feel don't fit your needs. You must also keep a "bound book" record of all purchases and dispositions of C&R firearms. This book may be examined by the BATF by appointment, but I have yet to hear of anybody who has had their books examined.
C&R firearms are any firearms over 50 years old and/or unique and of collector interest (Yugo SKS and CZ-52s are good examples). The BATF maintains a large list of C&R firearms:
http://www.atf.treas.gov/firearms/curios/index.htm
To apply, fill out the application and make two copies, then sign them both. Send one copy to the ATF with a check for $30. Send the other to your local Sheriff or Police Chief (whichever has juristiction for your home) with instructions to file. It does not require their approval or even any notice that they received it. The licence is good for three years.
Here's the application form:
http://www.atf.treas.gov/forms/pdfs/print2.htm
Applying for and using one is way easy. Paying off the credit cards will be the hard part!
More info:
http://www.atf.treas.gov/firearms/faq/faq2.htm#g
http://www.atf.treas.gov/firearms/nlc/ffl/faqs_collect.htm