can someone explain what the question "how does evolution work?" is actually asking.
Evolution is based on the idea of survival of the fittest. When (genetically-based) variation exists in a given population, certain individuals will be selected for/favoured. These individuals will hence more likely (even if only slightly) to reproduce, and produce more (viable) offspring. Hence over time, their genotypes (i.e. the genetic basis of the advantage) will increase in frequency, until all members of the population share the trait. Expanded over (a lot of!) time, and many different traits and selection pressures, this explains how speciation and the evolution or development of species occurs.
A simplistic example is rabbits in the alpine region of Australia with varied colour (ranging from white to black). In each generation, black rabbits are slightly more likely to be predated upon than white rabbits. Hence after 5 generations, given no other selection pressures, gene flow or genetic drift, more white rabbits will be reproducing, and the 'white' allele will increase in frequency. Eventually, all rabbits will be white. Coupled with other factors (e.g. thicker fur, splayed feet, hibernation, different mating patterns), and enough time, the snow sub-species may differentiate to such a degree that they can no longer interbreed with the originals.