Skype, just like anything else on the Internet, is subject to being overheard.
Here is the way that stuff works in an ideal world:
Your computer -> Skype server -> other guy’s computer
Here is the way that stuff could actually work.
Your computer -> router -> hacked router -> router -> Skype server -> more routers -> other computer
Basically, anybody in the data transport chain could be listening in. It’s like a mail service. Chances are, nobody is reading your letters; however, should someone want to read your mail, there isn’t anything stopping him.
About the viruses, I’m not so sure that there could be viruses (actually worms) that could travel through the Skype system, as it would require that the recieved data to be executed directly on the CPU.