Terrain Collision.. how does it work?

//look for the TerrainBlock called "Terrain" here
TerrainBlock *terrain = dynamic_cast<TerrainBlock*>(Sim::findObject("Terrain"));
if(!terrain) {
    Con::printf("Terrain not found!");
    return;
}

Box3F b = terrain->getBoundingBox();
ConcretePolyList list;  //... or whatever PolyList you need
terrain->buildPolyList(list, b, SphereF());  //fill the PolyList

// Set up collision stuff.
   mSpace = dHashSpaceCreate(0);
   mWorldTriangles = dGeomTriMeshDataCreate();
   
   // Make some triangles...
   Box3F worldBox(-5e2, -5e2, -1e3, 5e2, 5e2, 1e3);

   ConcretePolyList cpl;

   p->getContainer()->buildPolyList( worldBox,
      TerrainObjectType     | InteriorObjectType | 
      StaticShapeObjectType | StaticTSObjectType , 
      &cpl);

   int idxBound  = cpl.mIndexList .size();
   int vertBound = cpl.mVertexList.size();

   dVector3 * verts = new dVector3[vertBound];
   int      * idx   = new int[idxBound];

   // Load vertices
   for(U32 i=0; i<vertBound; i++)
   {
      verts[i][0] = cpl.mVertexList[i].x;
      verts[i][1] = cpl.mVertexList[i].y;
      verts[i][2] = cpl.mVertexList[i].z;
      verts[i][3] = 0;
   }

   int idxCount=0;

   int skipCount=0;
   // Load indices
   for(U32 i = 0; i<cpl.mPolyList.size(); i++)
   {
      if(cpl.mPolyList[i].vertexCount > 3)
      {
         Con::warnf("Skipping an %d-gon on an object @ %x(%s)!", 
                        cpl.mPolyList[i].vertexCount, 
                        cpl.mPolyList[i].object, 
                        cpl.mPolyList[i].object->getClassName()
         );
         skipCount++;
         continue;
      }

      for(  U32 j=cpl.mPolyList[i].vertexCount+cpl.mPolyList[i].vertexStart;
            j>cpl.mPolyList[i].vertexStart;
            j-- )
                  idx[idxCount++] = cpl.mIndexList[j];
   }

   Con::printf("Set up world collision info, %d vertices and %d polygons.", vertBound, cpl.mPolyList.size());

   dGeomTriMeshDataBuild(
         mWorldTriangles,
         verts, sizeof(dVector3), vertBound,
         idx, idxCount/3, 3*sizeof(int)
  );

ConcretePolyList cpl;
TerrainConvex* convex = new TerrainConvex;
   buildConvex(worldBox,convex);
   TerrainConvex* temp = convex;
   
   CollisionWorkingList& wl = convex->getWorkingList();
      for (CollisionWorkingList* itr = wl.wLink.mNext; itr != &wl; itr = itr->wLink.mNext){
        temp = static_cast<TerrainConvex*>(itr->mConvex);
        temp->getPolyList(&cpl);
      }