I know this has been online for a week or so, but I wasn't able to view it for some reason. So I've been grumpy and keeping out of the discussion (thanks to Nicole for screenshots and description though!). But now, through not entirely legal means, I have seen the episode and it was beautiful!
For those unfamiliar with the show, Portlandia is a sketch comedy with observational humor. Based on this episode, I really liked it. There are some pretty funny skits on bad tattoos (featuring Eddie Vedder), an artisan knot maker (Jeff Goldblum), and an allergy pride parade. The James part is at the very end, where BSG-obsessed Doug and Claire have gathered together James, Edward James Olmos, Ron D. Moore (who's just some black guy with the same name), and a "local actor", played by the real Ron D. Moore. They do a table read of "one moore episode", and the hilarious part for me is how excited James is to just play along and please the fans. He's basically playing himself, Nicest Guy in the World.
Eddie, on the other hand, is visibly uncomfortable and openly grudging about his role in all of this. He even gets up to leave at some point. The script is a bit ridiculous, including lines like "I need you here, now get out of here!" The "local actor" pronounces "frak" as "frayk". Even James has some issues with the script, although he's nice about it: "Do I just repeat 'you gotta listen'?"
Then - the fake Ron Moore's wife comes home, unhappy to find all of the strange people still there. Dramatic drums, zoom-ins on everyone's face. James breaks the tension: "I've got an idea, something we can all do together to relax. Are you familiar with Dr Who?" And then they watch Dr Who, and Eddie falls asleep, and they all agree to watch one more episode.
Also, James is pretty frakking handsome in this, with long hair and some kind of facial hair stuff. And he wears shorts. (And he drinks Coke I think, and you can kinda see his belly when he's sitting on the sofa, and it's all very sexy.)
Oh goodie, it's already on Youtube!
With many thanks to CZDeus.