The folk at Kirstens Viewer (or KV) have spilled the beans! SL isn’t magic! Their display shows exactly how it works:
Stuff goes in here…..^^
and comes out here ^^ Not magic at all.
Don’t get your nice shoes all wet in the memory leak…
See the KV display at http://maps.secondlife.com/secondlife/SL8B%20Impressive/117/59/22