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How they work: depending on the target area, they the build-test|qa|production targets simply scan all patches in all hot-deploy components (for instance in /hot-deploy/component-name/patches/test) and apply them. The "prepare-to-build-qa|production" targets have something specific. When you maintain URLs and misc. parameters variations inside properties files, it's often easier to directly maintain those files and copy them over in those areas than maintaining/updating patches for them which can be a repetitive and tedious task, those targets do it for you.

Now about the 1st build-dev target: sometimes you don't even create any hot-deploy components (eg. some projects might use OFBiz as a web services API with few modifications in OFBiz core), or you need to put patches somewhere before creating a hot-deploy-component, or your patches are common to all deployment areas and it does not make sense to maintain duplicates. Then to keep your OFBiz working copy free from modifications (which could else been put in one of your hot-deploy components patches directory, which is anyway not very logical but pragmatic),  you put your paches in the runtime/patches folder where "core" patches (those which change OFBiz as it's OOTB) are supposed to be. The "build-dev" target, purposely independent of other targets, is called by the main build target, exactly before anything else. The idea for the build-dev target is to keep patches with features separated (ie grouping different files changed for a feature in a patch), but you can, or may have to, do it on a file level, notably when 2 or more features impact the same file...

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