dd does a block copy from input to output, /dev/zero is a device in linux that will always read zeros. smartctl is a cmdline utility (part of smartmontools package) that can be used to read error logs and counters from hard drives. So he uses dd to write a bunch of zeros to a new drive in blocks of 8MB and then checks to see if the smart firmware reported any errors.
http://smartmontools.sourceforge.net/man/smartctl.8.html
The zpool/scrub bits are specific to running a zfs pool but could be useful to check a batch of drives at once.