Larry, yes it is a difficult thing to wrap one's head around. Basically what happens is that water does not want to cross the junction between finer material and coarse material, so the flow of water comes to a stop when it gets to the coarse material. It won't cross that boundary until it is basically "forced" to do so when the top fine material becomes so saturated that it can't hold any more water.
This phenomenon is called a "perched water table". It's the principle used to build sand-based golf greens and was discovered over a hundred years ago but still we see coarse material recommended at the base of pots.
Years ago I was skeptical myself so I did a test using two equal sized pots,, one with coarse material at the bottom and one without. Then I poured a measured amount of water into the pots. It turned out to be true, the potting mix above the coarse material stayed wetter than the one that was the same material throughout the pot. So not only was it losing growing space, it was keeping the roots wetter.
You can see illustrations of another experiment on the Garden Professors' website to show what happens below. Instead of going down into the coarse material to start with, the water instead goes sideways until saturation forces it down:
http://gardenprofessors.com/co...