This was a special short "mini-sode" done for the BBC's "Children in Need" telethon in 2007. There've been a number of these over the years, but this one is my favorite, since it features the Fifth Doctor having a brief encounter with the Tenth. It occurs right at the end of "Last of the Time Lords" and leads into the beginning of "Voyage of the Damned". It was written by Steven Moffat and directed by Graeme Harper (appropriate, since Harper was the only man to direct both the Fifth and the Tenth Doctors). The whole thing is essentially Moffat's love letter to a period of Doctor Who that he (and Tennant) regard nostalgically. I won't be seprating out any "fun quotes" - the whole thing is one long "fun quote", although my particular favorite is the line about the Master's "beard". Davison looks quite good in this - considering that he was 56 in 2007, as opposed to William Hartnell, who was 55 in 1963 - and it really whets my appetite for a full-blown team-up between the Fifth and Tenth Doctors. They had some fun with the music as well, using synthesizers to evoke the Fifth Doctor era.
As far as continuity goes - I regard it as canon, although it's not necessary to do so if you don't want to. The Fifth Doctor knows about LINDA, and they account for the Fifth Doctor looking older with some bushwa about the "time differential", but whatever. I'm content to overlook that sort of thing, myself. the only bit that seemed the tiniest bit "off" is when the Tenth Doctor tells the Fifth that "you were my Doctor", which does make it seem a bit like he's sweet on himself.
Overall, though, it's alot of fun.
[Part of list of Doctor Who episodes here.]
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Man, this one punched me in the gut the first time I saw it. Love it.