I'm from Canada, but since many agencies work in both countries, I assume the way they operate is pretty much the same, despite differences in the health care system. An agency covers hospital assignments when the hospital is unable to find enough of its own staff to do so. They also provide in home nursing, either privately, through an insurance claim, or through government funding. Here in Canada, they must have a contract to do the publicly funded work.
I have worked for a number of different agencies, and there is a WIDE difference in how well/poorly they are run! So be careful!! I nearly ruined my nursing career working for one that sent me out without the skills or training I needed for an assignment, then did not provide adequate support for me when I needed help. The good ones train their employees well enough that this does not happen. They also provide support staff (clinical consultants, specialists in areas such as wound care, diabetes, palliation, etc) to help you when you suddenly find yourself in over your head.
I got my initial nursing experience doing hospital relief assignments through an agency, and fortunately, it worked out okay for me. However, it could easily have gone the other way. If I had met with unsympathetic hospital staff that first day, they could have asked that I not be allowed to come back, and that would have been it! Hospital nurses are often not very friendly with agency nurses, but if you're lucky, you will find some who are and who are willing to show you the ropes. Once you get used to a unit, and know their policies and proceedures, and where to find the supplies you need for your shift, generally they'll keep sending you back to that unit whenever they need extra staff. Good luck, and hope you can find a mentor to help you along!