How exactly does "Preserving Baseband" work?

[bugbucket]

So I'm about to jailbreak a brand-new iPod and this time i'd like to be able to upgrade when the new version (iOS 6 in this case) comes out. I hear that "preserving the baseband" is the way to do this; do i need a certain jailbreak to achieve this? Once it's jailbroken, can i just upgrade it once the new iOS is released? It'd be really nice to be able to not have to totally restore my iPod once the new iOS hits so i'm hoping that this'll work. Thanks!