Crystal oscillators generate pretty accurate frequencies, but the output varies a bit depending on the operating temperature. The crystal oven heats a crystal to a constant temperature to get the most accurate and consistent frequency possible.
Via Hack a Day.
This type of oscillator is generally called an OCXO (ovenized crystal oscillator). You get better performance from a crystal cut which is designed from the outset for operation at a specific oven temperature (for example 70C), instead of ovenizing a generic oscillator. At the moment (May 2011) there is a guy with a stock of 26 MHz OCXO parts for $2 each on ebay. (normally an OCXO will go for $50 to $100 used and $200+ new)