I don't know the exact rules, I believe when you sign up it's more specific, but I don't think they are very picky about the condition of the book. Highlighting and markings are fine. If the book looks like it's been run over by muddy tires or missing pages or something, probably not, but overall, I think they accept about anything.
Once the phone says yes, you put it in the cart, hope to find some more and then take them home. I think they ask that you mail them to them weekly. Again, something to check out on their website. You print out a shipping label on their site and then as soon as they recieve them you are paid. You ship them via media mail though, so it will take a week or so to get your money.
Also, someone had asked about books that cost $2.29 or something like that. You will always want to round up unless you don't mind getting less than a $1.50 profit on them.... So I'd round it up to $3 and get .70 extra. Just remember though, the cheaper the book the better chances it will be a yes. And let's say you put a book in for $1 and it's a yes. You decide to be sneaky and try to make more and put it in again as a $3. Don't. They keep a log and they'll know you're trying to pull one over on them and I think it freezes the system if you do that.