In my Pulse packet-searching, it does not appear to send ANY keys at all.. so it's not a keylogger, it just logs how many times you send a key to the motherboard.. at least, that's what I think it does. I don't know for sure.. i don't have any source to look at.
EDIT: More investigation (much better using Ethereal) notes that it sends some sort of encrypted GET message (number of keys, mouse clicks, password, user id, and unix timestamp?), then the server responds with something like, for example,
Code:
HTTP/1.1 200 OK
Date: Mon, 20 Sep 2004 03:26:35 GMT
Server: Apache/1.3.31 (Unix) mod_ssl/2.8.19 OpenSSL/0.9.7d PHP/4.3.8 mod_perl/1.27 FrontPage/5.0.2.2510
X-Powered-By: PHP/4.3.8
Transfer-Encoding: chunked
Content-Type: text/html
18
100 OK 14881.4800.15848
0
The "14881.4800.15848" is just returned to the client telling it, for example, i had 14,881 total key counts, 4800 total mouse clicks, and my ranking was 15848th. I found this out by spawning a geek windows (rightclick the W, hit spawn geek window) and finding this out.
So for the highly paranoid, yes, it is safe. So

and

and

WP