This chapter walks through the process of adding links to the contextual drop-down widgets new in Drupal 7. It also shows how using menu autoloaders can help simplify the code that you write in your page callback function since you won't have to do extra checking on the data.
As a note, if you are wondering why we started our function with an underscore (_), naming functions with an underscore in front of the name is a common convention in Drupal that sort of implies that "this function is for internal use by this module only" and shouldn't be called by itself. It's also a nice way to ensure that your internal functions are not colliding with the namespace of a hook or another module. Here's a good blog post about naming things.