This is how I use it.

It is very helpful when you can't access a computer.

1)Download a homebrew app using the PSP web browser.(ex. PSPTube)
2)Save it in ms0:/PSP/COMMON
3)Run the PSP Rar extractor.
4)Now there should be 3 options, RAR File,Extract to, and extract
5)Highlight "RAR file" and press [] and navigate to ms0:/PSP/COMMON/whatever app you downloaded.
6)Press [] on "extract to" and navigate to ms0:/PSP/GAME150
7)Press "X" on extract... and it will extract their and it will be fully functional

P.S. Make sure you have the correct file mode. (Ex. if you download a .zip file, make sure your option is on .zip and not .rar. You can do this by pressing "L" or "R" at the main screen until it says "Extract a WinZip/RAR File" at the top of the screen

P.S.S. You will need some kind of file browser so that you can delete the archive(s) from ms0:/PSP/COMMON so that all the archives won't accumulate space on your memory stick.