NSD is a great facility. It's a program that ships with both the Notes Client and the Domino Server. It takes control in the event of a crash, and writes a diagnostic log that is frequently very helpful in figuring out what went wrong. If you ever experience a (rare, but not unheard-of) crash in Notes or Domino, nsd.exe will automatically come online and do its thing. You'll find the resulting crash log in the IBM_TECHNICAL_SUPPORT sub-folder in your Notes/Domino data tree. If you report the crash to Lotus (recommended, otherwise how will they know how to fix stuff?), make sure to zip and include the log in your submission.
There are times, however, when you don't want NSD to be invoked automatically, This is particularly true for developers, who might want to launch a debugger instead. This has been true for me when (as one example) I was working on a server add-in module (written in C) that had a bug in it, or when doing other kinds of server or client plug-ins (Extension Manager, DSAPI, etc.). I also have had cases where I was developing a C# program that used the Notes COM classes. Something I was doing caused Notes to crash, and I wanted to debug it, but NSD kept popping up and getting in the way.
So I did some research, and found 2 ways to disable NSD. Read all about it on my blog: http://www.bobzblog.com/tuxedoguy.nsf/dx/need-to-disable-nsd-here-are-2-ways-that-work