Here's my quick and dirty version of the full story on Crucible's site.
Dontcha hate it when you get chocolate chip cookies that have a big section with no chips, and then a bunch of chips clumped together in one area? And wouldn't you rather have more chips per square inch of cookie than less?
Well, this same thinking goes along with powdered steels! Steels are alloys, and the particle making process allows you go get some awesome alloy combinations that you can't get with traditional methods (as mentioned above already). Ever wonder why a lot of CMP steels have high vanadium and high carbon contents? You can create some very interesting alloys with the process.
O.k. then, let's talk about the particles. Each particle is a perfect combination of all of the elements you want in the steel. Then when the particles are welded together, you have a perfectly homogeneous steel with even dispertion of the elements. Carbides in steel do a lot of the real aggressive cutting. All steel has carbides, but not all carbides are alike. Vanadium carbides are harder than chromium carbides. In fact, Vanadium carbides are some of the hardest carbides out there- so they stay sharp a long time and make good cutting teeth! In traditional steels, you can get clumps of carbides in some areas and other areas will be missing the vanadium carbides and such- not too cool. This is just like the chocolate chip cookie with that big area that is all dough and no chocolate chip! So the particle metallurgy process evens things out.
Knife makers who heat-n-beat their steels can even things out a lot in their steels- this is one of the things that is meant when you ehar that the steel is being "refined". And this is also one of the reasons that the Japanese Sword traditionally has all of the folds and such- the steel that they start with is not homogeneous at all! Heating, folding and hammering is like mixing up dough and kneeding it- makes for a nice consistent dough.
That sounds kinda like Dan Ackroyd asking Chevy Chase "what's a dickfur?"