Google intends Car Home to be used when your phone is sitting in a car mount attached to your windshield or dashboard. It shows only the car-friendly features of your phone – like navigation, voice-activated commands, contacts, etc. – in big touchable squares. Really, it makes your Android look like a Garmin or TomTom-style personal navigation device.

Does it work? Oh yeah. It makes your phone safer to interact with in a vehicle. Just make sure you use a mount and follow all local laws about phone use while driving. You can set your phone to switch to the Car Home interface automatically when you connect to a specific Bluetooth device, which is perfect if you have a Bluetooth speaker in your car.

Car Home should evolve much more quickly than your car’s dash because Android developers can now update their applications with a car mode interface and choose to appear in the new Car Application category of Market. You can customize your Car Home screen with new apps and features by using the Add Shortcut option. You also can set your own wallpaper for Car Home.

Take your Android out for a spin with Car Home. Though, keep in mind, that, as of this writing, Car Home is only available for the Nexus One and Motorola Droid.