well only being able to divide existing triangles means you cant add geometry doesnt it ? (doesn't matter how many time I subdivide a triangle its still going to look like a triangle)
... but what you do then is apply a displacement map to it. There's no point displacing just a few verts, but if you've got lots of them you can get nice details. That's one thing tessalation is useful for. It's a cheap way of giving displacement maps the verts they need to play with. That's how I understand it anyway, and why I couldn't grasp what Otto was on about.