From the official award website:
This is the first year for the Indie RPG Awards. It's been a tremendous success because of the help and support of last year's independent game designers, as well as the community which supports them.
I created these awards because I liked what I saw going on in the independent game publishing realm: Sites and communities like RPGNow, The Digital Publishers' Group, and The Forge (among many, many others) were making a lot of progress in the production and publication of excellent games... and yet there were no awards, honours or events recognizing their collective efforts. A few of us just happened to have the time, energy and will to gather feedback and organize such an event. These Indie RPG Awards are the results of that organization.
These awards are a way for all sorts of folks - from Indie RPG designers and other industry folk, to fans of various independent games, to perhaps folks who are curious about independently published games - To gather around and look back on the various games, supplements and zines that 2002 had to offer. Imagine it more of a social event somewhere between a cocktail party and barbeque than a formal awards ceremony like the Academy Awards.
The awards themselves are a byproduct of this celebration. While we're not here to find the Ontologically Best Indie Games, we still think that we can have a friendly gathering of Indie industry folk to gather around and throw their 2 bits in on games that they found to be remarkable for one reason or another. This is currently the only forum for such an event: Most of these games and supplements cannot win awards because they do not rely on traditional methods of print distribution (and thus cannot take part in the ORIGINS awards), or are not strictly d20 products (and thus cannot take part in the excellent ENnie Awards).
In the end, awards have little meaning outside the community that gives and receives them: They don't guarantee sales, they don't shake the RPG industry, and they don't mean that one game is objectively better than another. However, they do give a little recognition to the hard-working folks who put their time and sweat into their products of love and labor. And that is enough to matter.