Viewing the source will always only give you the raw HTML after any PHP, ASP, or any other code has been executed.
The include works just as one would think it does. It includes another php page wherever you put the include call in the page.
EX:
http://dojo.motionless-continuum.com/ All the stuff in the lower right hand box, and the news, and other content is all being include from other files. When you press a different button it includes a different page in that box.
The actual code just goes like this(granted this code would not work)
<mytable>
<myrow>
blah
</myrow>
<myotherrow>
<?php include('myotherpage.php');
</otherrow>
</mytable>
The Inlcuded page would show up in the second row of the table.