To alter the height of the car on a coilover, simply tighten or loosen the bottom spring cup to either tighten or loosen the spring. A tighter spring/lower car means a harder ride and a looser spring/higher car means a softer ride. The dampening adjustment gives you some room to make the ride softer or harder (depending on your lowness). This is done with a rod that slides into the top of the damper and adjusts the internals of the damper, allowing it to compess more or less.
Well that's my understanding of it
Tightening and loosening will only change the stiffness of the ride if the spring is of a variable rate which I believe most are these days.
I was also wondering what changes in camber are caused due to lowering the car? E.g -.5deg for every 20mm lowered?