I do not have any particular expertise in the matter, but I am fairly sure that even for the expensive, fancy equipment available to the FBI or NSA, reading data that has been overwritten more than once or twice is a very hit and miss affair.
I believe that these methods rely on slight inaccuracies in the positioning of the head of your hard drive, so that when it comes back to write a new 1 or 0 over the 1 or 0 that was written there before, it does not come back to exactly the same position as before, and writes the new bit at a position that overlaps, but does not completely cover, the tiny spot on the disc where the old bit was written. The machines used by law enforcement and national security agencies can read the small edge that did not get overwritten inasmuch as they can position their read head much more accurately than that of a normal disc drive, and step it in smaller increments.
However, this must be getting more and more difficult to do successfully as consumer disc drive technology improves, with drives packing ever more information into smaller areas of disc, which itself relies on ever more accurate head positioning. Also, each time the old data is overwritten, the chances of there being a small part of the area where the original bit was that has not been overwritten, and so obliterated, decrease rapidly. One overwrite is very likely to leave a sliver of the original bit behind, but the chances are very good that that sliver will be overwritten the next time that part of the disc is written to (leaving, perhaps a sliver of the first overwrite), and, by the third overwrite, the chances of anything of the original bit remaining must be very low. You sometimes see claims that data needs to be over written something like 9 times to be truly secure, but I am fairly confident that in reality even the with the very best equipment you would need to be very lucky indeed to be able to read something that been overwritten 8 times, and really pretty darn lucky to be able to read something that had suffered just 2 or 3 overwrites.
Incidentally, you do not really need special applications to securely erase (i.e., multiply overwrite) data. Windows XP has a utility built in. If you open up a dos box and enter cipher /w:xxxx at the prompt (where xxxx is the name of any directory immediately under your root directory - don’t ask me why you need this, but you do), it will overwrite all the “free space” (i.e., anywhere where files deleted from your recycle bin might live) three times, with ones, then with zeros, and then with random bytes. It will take a while if you have a lot of free space, but it should be pretty secure, although if you are really paranoid I guess you could always run it again to get 6, or 9, or whatever multiple of 3 overwrite you might want.