The goal of rewriting or spinning is to write just one base article for the most important article directories or Tier 1 or Tier 2 sites and then spin this unique article to get hundreds of unique variations you can submit to other article directories or Tier 3 sites.
Why not use just one article? The reason is simple: Especially since the so-called “Panda” Update Google hates duplicate content more than ever. Major article directories, like articlesbase and ezinearticles, lost more than 80% or their total visibility and traffic due to this algorithm updated targeted at content farms. That’s why some call it “Farmer Update”.
Duplicate content does not rank any more and even worse, links inside duplicate articles are devalued to zero by Google. So, submitting the same article to thousand article directories will pretty much have the same effect like submitting to just one. Loads of effort and wasted time for links that won’t count or help you for SEO and ranking. SEOmoz published an interesting post on their blog (read article) about it, explaining what variations of duplicate content exist and how Google handles them with the new “Panda” algorithm.
Articles spinning can be either done by automatically rewriting using a software that replaces words with synonyms or by selecting these synonyms, e.g. from a drop down menu, for as many words in an article as possible. Results vary - the more you spin the less readable an article will be for visitors, but it always stays semantically correct and can’t be detected as spun content by the search engines if done right. It's recommended to spin to 50% to 70% uniqueness but keep in mind most articles won’t rank anyway, so it’s more about building quality in-content backlinks than readability for the user. The less you spin, the higher the odds that Google may see the spun article as a duplicate of the original.
Automatic rewriting requires some training, but after the first few articles you’ll easily learn how to perfectly spin your content. Do some training before you start you first submissions of the spun articles since the quality of the spinning will influence the number of articles approved on article directories that do no auto-approve every submission dramatically.