The quantum state of a system is not described by a simple real probability but by a complex number. This means that there is an additional degree of freedom that you can adjust in a quantum state that doesn't change its probability of occurring. The nature of entanglement means that there is constructive and destructive interference when you go through certain quantum operations.
Traditionally, a quantum word can be thought of as being a probability distribution over the various possible values of the word. You can build quantum gates that act like classical gates on the binary values, and it's this property that often causes people to describe a quantum computer as executing every possibility in parallel. The difficulty is that the result you get is sampled by the probability distribution, which means you need some sort of interference between the results to allow you to boost the probability of picking the answer you want. A quantum speedup is only possible when you can find the interference. In the case of Shor's algorithm (for factoring), the interference is basically a quantum variant on FFT; in the case of Grover's algorithm (finding x such that f(x) = y), the interference is something that redistributes the probabilities among a plane of the sphere.