hasItem, hasCooldown, repairCost = 
 Tooltip:SetInventoryItem("unit", invSlot {, nameOnly});

This function sets a tooltip widget to display information for the given unit's given inventory slot.

Arguments

("unit", slot {, nameOnly})

unit 

String - the unit whose inventory should be searched

slot 

Number - the inventory slot number to search

nameOnly 

Unknown - unknown argument

Returns

hasItem, hasCooldown

hasItem 

Boolean - is there an item at the given slot?

hasCooldown 

Boolean - unknown

repairCost 

Number - cost of repairing item

Example

-- See if the player has head gear and if it is broken

function HasHeadGear()
 local headSlot = getglobal("CharacterHeadSlot");
 local hasItem, hasCooldown, repairCost =
  MyTooltip:SetInventoryItem("player", headSlot:GetID());
 if ((hasItem) and (repairCost) and (repairCost > 0)) then
  return true;
 else
  return false;
 end
end

Source

This information was obtained via a Google cached page of a Thottbot index of a now expired official US beta forum post by Angarth. It appears to still be correct.

repairCost info obtained from orginal blizzard lua files (PaperDolFrame.lua and MoneyFrame.lua)