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You are exactly right- it works almost just like a C-6 with an avermarket overdrive bolted behind it would. There are three primary ratios, and the overdrive gear is used to split them- hence why there are actually 6 gears.
i have seen one apart at my best buddies shop "levelten transmissions" and was amazed at how they are built. pat states it is off the c6 and we can beef them a lot.
how much additional h.p. a stock one can handle i truthfully don't know. how much can we beef them to take more. i have to leave it up to the pro's that rebuild them and i think we all know shops that each member likes that can answer that.