What is the servicing stack and how does it work?

In Windows, there's something called the servicing stack which seems to fulfill the role of a package manager. I don't understand it very well, only that it seems that Component-Based Servicing (CBS), Windows Installer, Windows Update, and WinSxS are part of the servicing stack or are otherwise involved in servicing.

I've done lots of research and have not been able to find an easy-to-understand overview on servicing in Windows. Hence, I'm asking the following:

• What is servicing and what does the servicing stack do?
• How does the servicing stack work? What roles do CBS, Windows Installer, WinSxS, and Windows Update play?
• What utilities does Windows provide for interacting with the servicing stack?
• What happens when there is a servicing problem? What servicing issues can cause a Windows update to fail to install?

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