Yes, crackers have had their way with the Dreamcast, and it seems they're now going to town posting games all over the web. The crack works via a "loader disc" scheme; a CD-R with a particular piece of code is used to make the Dreamcast think the pirate game discs are real Dreamcast games. Insert loader disc, then insert game disc. Simple enough, I suppose.
Sega is reporting only 5-10% of the U.S. Dreamcasts will work with the system; the crackers are claiming that's a bunch of bull. Never underestimate the ingenuity of a human wanting to steal something.