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dont they just drive great? this isnt exactly how they work but close,
"Continuously variable transmissions operate on the theory of pulleys; a large pulley connected to a smaller pulley with a belt or chain will operate in the same manner as a large gear meshing with a smaller gear. Typical CVTs have two opposing, cone shaped drums in them (one on the input, one on the output side) which can be moved in and out, controlled by the engine vacuum in the inlet manifold and engine RPM and centrifugal force acting on weights inside the conical drums. Moving the cones in and out has the effect of changing the driving and driven pulleys' diameter, thus changing the gear ratio. As there are no predefined steps in the system, it's referred to as continuously variable.
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Dutch company DAF made cute little Euro-boxes back in the 60s and 70s with such a system.
Google DAF 44 or DAF Variant and see if there are any technical sites expalining.
Chris
Have a look at wikipedia Continuously_variable_transmission (http://en.wikipedia.org/wiki/Continuously_variable_transmission).
koan