That is correct. The block size varies depending on the formatting of the FileSystem (default for NTFS is 4K <8-sectors>). When each block is changed, an entry is journaled into the metadata with the change date/time. The comparison between the last imaged metadata and the current on-disk metadata is made and blocks are selected (only changed blocks) for imaging accordingly. A restore will put back only the blocks in the image than are different than the on-disk metadata (newer or older depending on the image used for restore)... basically only changed data blocks will be restored (AKA "DeltaRestore").
It truly is a "time machine" of sorts"
It truly is a "time machine" of sorts"