Is a Turing machine a real device or an imaginary concept?
When Turing first devised what are now called Turing machines, he was doing so for purely theoretical reasons (they were used to prove the existence of undecidable problems) and without having actually constructed one in the real world. Fast forward to the present, and with the exception of hobbyists building Turing machines for the fun of doing so, TMs are essentially confined to Theoryland.
Turing machines aren't used in practice for several reasons. For starters, it's impossible to build a true TM, since you'd need infinite resources to construct the infinite tape. (You could imagine building TMs with a limited amount of tape, then adding more tape in as necessary, though.) Moreover, Turing machines are inherently slower than other models of computation because of the sequential nature of their data access. Turing machines cannot, for example, jump into the middle of an array without first walking across all the elements of the array that it wants to skip. On top of that, Turing machines are extremely difficult to design. Try writing a Turing machine to sort a list of 32-bit integers, for example. (Actually, please don't. It's really hard!)
This then begs the question... why study Turing machines at all? Fortunately, there are a huge number of reasons to do this:
To reason about the limits of what could possibly be computed. Because Turing machines are capable of simulating any computer on planet earth (or, according to the Church-Turing thesis, any physically realizable computing device), if we can show the limits of what Turing machines can compute, we can demonstrate the limits of what could ever hope to be accomplished on an actual computer.
To formalize the definition of an algorithm. Why is binary search an algorithm while the statement "guess the answer" is not? In order to answer this question, we have to have a formal model of what a computer is and what an algorithm means. Having the Turing machine as a model of computation allows us to rigorously define what an algorithm is. No one actually ever wants to translate algorithms into the format, but the ability to do so gives the field of algorithms and computability theory a firm mathematical grounding.
To formalize definitions of deterministic and nondeterministic algorithms. Probably the biggest open question in computer science right now is whether P = NP. This question only makes sense if you have a formal definition for P and NP, and these in turn require definitions if deterministic and nndeterministic computation (though technically they could be defined using second-order logic). Having the Turing machine then allows us to talk about important problems in NP, along with giving us a way to find NP-complete problems. For example, the proof that SAT is NP-complete uses the fact that SAT can be used to encode a Turing machine and it's execution on an input.
Hope this helps!
It is a conceptual device that is not realizable (due to the requirement of infinite tape). Some people have built physical realizations of a Turing machine, but it is not a true Turing machine due to physical limitations.
Here's a video of one: http://www.youtube.com/watch?v=E3keLeMwfHY