A Full Tilt Poker sponsored pro Gavin Smith whom you may know from his various World Poker Tour and WSOP cashings and wins, left a great article with Full Tilt's website recently about live tourney settings. Reading people during a hand becomes much more involved then watching how they shuffle their chips or send some of their chips into the middle while betting.

Smith describes learning a little about the person behind the online poker visor and sunglasses while making those decisions on raising or folding while in a tournament. Some very sound reasoning Smith mentions, behind playing someone like myself during a bigger buy in tourney where I probably satellited my way in and generally would play tighter while attempting to cash, versus a player who bought their way in from a hot roll at the craps table or is a pro like himself.

Here's Gavin's article describing how a little table talk can go a long way towards making the right moves on the felt:

I talk a lot at the table. I like meeting people, and poker tournaments give me the opportunity to chat with a lot of nice folks. The conversations I have between hands are not just pleasant - they can also be informative. What a player shares about himself will often determine how I'll play against him down the line.
For example, say I'm playing in a $10,000 tournament. I ask the young person to my left how he bought into the tournament and he tells me that he won a $30 satellite. Based on that piece of information, I can make some assumptions. He's probably not especially experienced. Most active players don't bother with low buy-in tournaments. He likely doesn't have a huge bankroll, so he'd probably be perfectly happy to cash in the event; he doesn't need to win to feel he had a successful tournament.
Against this player, I'm probably going to run some bluffs when I think he's only got a moderate hand. I'm also going to be willing to make some pretty big lay-downs against this guy. I seriously doubt he's going to put in a lot chips without a very strong hand.
Now imagine that I ask a man at my table how he got into the tournament and he tells me he bought in directly. I ask him what he does for a living, and he says he's a bookmaker in Dallas.
I've got to assume that this guy's willing to gamble. He's probably not afraid of a big bluff or a big call. Against him, I'm going to have to call more liberally and avoid making any of my own big bluffs. I may even check some reasonably big hands to avoid getting raised off my hand.
These are just two examples of what you can learn by drawing your opponents out and listening carefully to what they have to say. Every piece of information you gain at the table is something you can use to your advantage.
Gavin Smith