What's that item supposed to do?

It looks a bit like a constant combinator, except when I place one down and click it, there doesn't seem to be a way to interact with it. Tooltip is non existent. I saw I can connect it with red/green wire, but to what and what for?

I'm not the author of that mod, but if you place it beside e.g. an assembling machine (you need to rotate it the correct way as well) it will read its contents and output that to the circuit network, e.g. how many ingredients/products of each item it currently contains. This can be used to decide when to insert the cube. You can accomplish something similar with buffer chests or other methods as well so it's not essential, but it could help.

Thank you. I was a bit unlucky and never randomly got the right orientation out of the possible four, that's what happened.
Now I can make it work.

Congratulations on producing such a novel and high quality mod. Great work!

My feedback so far is that the inventory sensor mod removes a challenge. I enjoyed solving the problem of filling and emptying machines using combinator counters, then I found this thread. I wonder if you should either make Inventory Sensors mandatory, to give players a break, or forbid it, to make them solve that puzzle!

I don't want to be too prescriptive or force people to play a certain way. I'll maybe add a note that it removes some challenge and let people decide for themselves. Note that there are easier (if slightly less perfect) ways than counters to solve the problem even without inventory sensor, and the same is true for many things in the mod. It's fine to hack it a bit, or design something clever and feel proud!

If this counts for anything,
a) such an item existing doesn't force anyone to use it.
b) memory cell counters, I'd assume, are something 95% of people trying this mod have built plenty of in the past. Not having to build more of them doesn't lessen the fun. I'd even say it's fun to have alternatives and it's not like those alternatives don't need work and thought. They might even represent more work to set up than a simple memory cell.
c) I am happy I discovered such an item exists by playing this mod.

If you want to warn players about the use of any item, fine. But Factorio players are pretty darn good at making the game challenging just enough for their own taste, be it with mods or by not using underground belts or other items, just for fun.