The cone, or "spacer" as you're calling it
is separate from the bolt head, in that one can turn while the other does not. It can also wobble around the shaft of the bolt, hence the name "wobble bolt".
If you look at an ordinary wheel bolt, the cone is integral with the bolt and the two are concentric. So as you tighten the bolt, the cone gets pushed deeper into the recess in the wheel that it fits into.
This works exactly the same way, except the bolt is not concentric with the cone. The cone is offset from the bolt by (wheel bolt circle diameter difference / 2). When adapting a 98mm hub to a 100mm wheel, each hole is off by 1mm ((100 - 98) / 2). So the bolt stays on the 98mm pattern (the hub pattern) and the cones stay on the wheels bolt pattern - 100mm. But the bolt provides the same clamping force (which is really what holds the wheel on) as in a normal situation, where the wheel and hub patterns match.
There is an illustration on the Serpent website Jim cites above that may help to illustrate this.
Pete