I don't think they work in any fully-understood manner. ;-) The inner edge (the green line) is always the "full" amount, but often it will overrule the inner fall off zone too, somewhat, even if the inner falloff extend farther into the joint. A lot of the more recent DAZ figures have a hard-edge on some bends because of this, incidently (like the front of the thighs). I'd say generally, the fall off zones only work in the area between the green and red edges.