Благодарю за ответ!
Теперь мне все стало понятно!

Рано радовался!
Вот что выходит:

#------------------------------------------
import md5
md5.md5("Nobody inspects the spammish repetition").digest()

>python -u test.py
md5
Traceback (most recent call last):
  File "test.py", line 2, in ?
    md5.md5("Nobody inspects the spammish repetition").digest()
AttributeError: 'module' object has no attribute 'md5'

#------------------------------------------
from md5 import md5
md5("Nobody inspects the spammish repetition").digest()

>python -u test.py
md5
Traceback (most recent call last):
  File "test.py", line 1, in ?
    from md5 import md5
ImportError: cannot import name md5

#------------------------------------------
from md5 import *
md5("Nobody inspects the spammish repetition").digest()

>python -u test.py
md5
Traceback (most recent call last):
  File "test.py", line 2, in ?
    md5("Nobody inspects the spammish repetition").digest()
NameError: name 'md5' is not defined