what does the rewrite do?

does it rewrite the index.php?id=1 to html?

does it rename the index to article title? making it topic-name.html?

and more importantly does it do a permanent redirect from the old index.php?id=1 url so that search engines that have it listed will recrawl and index the new page?

What else does it do? As I'm not up on my rewrites but I'm a quick learner :)

Any info would be much appreciated. Thanks