Sorry, I guess I'm dumb, what is spyware?

That depends on who uses the term. Originally spyware is a piece of software, that collects statistical information about a computer user (what sites he visits at, how often he's online), and sends this to a company which will try to create consumer profiles of it, which will later be sold to other companies.

When saying spyware many people are referring to any kind of additional software that is installed with a program, you download.

About those software additions some companies (including LimeWire) are using as a source of revenue, usually many rumours are spread, however you will very rarely meet any people, that actually know what they are talking about.

Spyware for MacOSX or linux does not exist. It's solely a Windows issue (and as a passionate Linux fanatic I have to add: Windows users generally don't deserve better.)