I found a very beatiful article on msnd about how Biztalk 2010 works. here some extraction complete artilce you can read from here
At the core of BizTalk Server are the Messaging Engine and the Orchestration Engine, which provide the underlying architecture for integrating and exchanging messages between various services, both within and outside your organization.
The BizTalk Messaging Engine:
Receives inbound messages.
Parses inbound messages to identify their specific formats.
Evaluates message content to identify how the message is to be routed and processed.
Delivers messages to their respective destinations.
Tracks the status and state of documents.
The BizTalk Orchestration Engine, in contrast, coordinates and schedules message processing and performs complex logic on the message as it is passed through a defined workflow.
For Complete article is here http://www.microsoft.com/biztalk/en/us/messaging.aspx