Depends on how well I know the person. If it is only someone in passing I simply say I am going camping for the weekend.If it is someone I know a bit better, like someone from work, then I explain I am doing medieval recreation with foam swords.
There's a few ways I respond, depending on the situation.My co-workers are used to me prattling on about stories from the game, so they've got a pretty good idea.Trying to explain what I do for the first time to someone in my family or a friend, I go into skimmed details. (IE: 'Well, I dress up in costumes, it's a fantasy setting, and we do X-Y-Z. It's like a movie, but with lower budget for special effects.')Strangers, if they chance upon me in garb in a McDonalds or something, I just say it's for a fantasical re-enactment.
I usually say I am going Camping, or Fencing. its Monday when I have to explain the limp or the bruises that gets more interesting. (my daughter hit me with a softball, not I blocked my friends weapon up to my face and took a hard shot to the eye)
I always explain it to people the way that I feel will attract them to it. I am always trying to get more people to come out and have a good time with us.I usually say I beat the shit out of people with foam bats and then we get hammered and party, oh and chicks take their clothes off around fires.
I don't talk about fight club.No seriously I tell people its Foam Bats, explain the rules loosely and try to get them to come to a fight practice so they can get a taste of the awesomeness.