When you use iChat Theater to share iPhoto photos, your video chat becomes a slideshow of the photos you choose. Both you and the person you are chatting with will see the slideshow.
First, a bit of setup: iChat Theater uses the ad hoc slide show settings in iPhoto so you should set those settings first.
- Open iPhoto.
- Select any album or group of photos.
- Click on the Slideshow button on the bottom toolbar. (This is different than creating a new slideshow.)
- The ad hoc slideshow settings dialog will apear.
- Choose the Classic theme and turn off music play.
- Check the Use settings as default checkbox.
- Click Play.
- As soon as the slideshow starts, hit ESC to stop it.
- Start a Video chat with the person you want to share photos with.
- Go to File / Share iPhoto with iChat Theater... from the menu bar. An iPhoto Browser will come up with your Events, Photos, Faces, Places and Albums. Choose the items you want to share and click the Share button.
The reason I suggested using the Classic theme and turning off music is that the motion and the music both have to be transmitted to the person you are chatting with. In my testing on a decent but not so great broadband internet connection, both motion and music sometimes caused the slideshow to break up on the other person's end. The other reason for not having music playing is so that you can talk about the pictures as you see them. (Make sure you have Microphone Enabled checked in the Video menu on the Menu Bar.)
To stop the slideshow from going along at its own pace, you can click the pause button on the bezel and then click through the slideshow manually using the arrow keys.
Once you are done sharing photos, click the large X icon on the bezel.
NOTE: For a more in depth discussion of iChat Theater and how to use it with other types of documents, check out this article from Tidbids.com.