I have a Terry one, and it fits like a cardigan sweater, but really short. It basically serves the same function as arm warmers, but since it's connected in the back, it isn't binding at the top of your arms.

I wear mine all the time. My winter riding ensemble looks like this:

high-tech base layer
cashmere turtle neck sweater
bolero
craft cycling jacket

If it's really cold, I'll add armwarmers as the outermost layer. Yeah, I can't put my arms down, but I'm warm!