Thanks to the wonderful idea from DeathandTaxes I was interested in an how transactions are placed in the blockchain. From my understanding :

1. The wallet generates an address.
2. The person who wishes to send you money send the transaction to your address, then saves that to the global blockchain
3. The wallet holder's wallet compares the blockchain every once and a while and if the transaction is on it (and verified by 6 other systems) it accepts the transaction and modifies the wallet accordingly.
4. The blockchain is modified to show that the transaction was completed.

This is what I've come to understand from lurking around Bitcoin wiki. I just kind of wanted to have it clarified. I have the feeling I'm off on something, maybe the whole thing, this is just kind of my guess at it.