So, how do you bypass the block chain completely? How does the coins get moved from the original address into these newly created wallets?
Did you read what he wrote before you started asking questions? He never claimed he is bypassing the blockchain completely. He is disguising one large transaction into many smaller transactions. He wrote: "We are not attempting to disguise the original sender, but we are disguising the amount of coins sent to one receiver."
He does bypass the blockchain when the wallets are sent to the receiver.