At the top of the create app page you'll see an app id and app secret, both long strings of numbers and letters. Copy these values into the WSN admin panel at Admin -> Members -> Settings -> "Facebook Connect" to enable facebook connect in WSN (it's auto-enabled when those two fields are filled).
You'll now see a "login with facebook" button on your site (on the login page, and the quick login area). If you have older customized templates or want to insert the login somewhere else, use
<IF {FBAPPID}><a id="fblogin"><img src="{IMAGESURL}/fblogin.png" ></a></IF>
When someone uses the login with facebook button who does not yet have an account on your site, an account is created with their username being their real name (or if that's already taken, their facebook username and if that's taken a random string is appended). This bypasses the normal validation requirements, as their email and other details have been certified accurate by facebook.
When someone uses the login with facebook button who already has an account on your site which is associated with their facebook account, they're automatically logged in. When someone uses the login with facebook button who is determined by cookie to already have an account, but it isn't associated with their facebook account, they're prompted to do a normal login to associate the two so that they'll be able to do the one click login next time.
Important: Member system integration with non-WSN scripts is not compatible with facebook connect.