For those new to ethnography, or looking for a simple way to describe it to others, the AIGA and Cheskin have put together an ethnography primer. The visual appealing PDF has limited content, but focuses on the value, basic steps, applications and terminology of ethnographic research to support design. Perhaps most useful is the brief descriptions of the respective activities of the ethnographer and the designer during each step of the research process.
Check it out, and while you're there, explore AIGA's redesigned site.