Quote Originally Posted by Ron Kruger
The way lens IS technology was explained to me by a friend who owns a photography studio, is that some kind of computerized system in the lens remembers what was in sharpest focus during a certain time before and up to the moment the shutter is pressed and then chooses that best image to send to the sensor. (Not sure I'm explaining this well.)
The lenses aren't that smart They don't really send anything - they employ servo motors to compensate for small movements along two axes. That does bring up a question of start-up time as in-lens IS requires a half second or so to spin up. I would imagine that the in-camera systems are quicker and use less energy.

As for Canon recommending that IS be turned off when tripods are used, yes and no. The latest generation IS (third or fourth) doesn't require the IS be turned off. I'm not sure if the IS is actually working when mounted to a tripod or if the servos can detect that a tripod is being used (by the lack of movements) and simply shut down.