Would you describe how a standard transaction would take place?
1. You connect the device into the USB and run Bitcoin wallet software
2. It automatically recognizes the device (by matching VendorID and ProductID of USB bus)
3. Software ask for master public key. Then it will be able to show your addresses and their balances.
4. When you want to send some coins, software creates template of bitcoin transaction and send it to wallet device.
5. Device displays transaction summary on its display and ask you to confirm transaction by pressing hardware button
6. Device signs transactions using private key stored in the device and sends signed transaction to desktop software.
7. Desktop software sends signed transaction to the bitcoin network.