Hi
Having a hard time understanding offline files

From what I understand offline files is a feature which allows a user to create a synchronisation with a file\folder as you log on\off (depending on your offline file settings). Correct?
I have this lab setup and please allow me to use this as an example.
We have, a server, a client and a file.
The server is sharing the file
The client then makes changes to the file
But the server shuts down
What then happens to the file? The file is saved to hard drive on the client and then updated\synch'd when the server is restarted? I've tried messing with it but I just can't grasp it

.
Also is there a way to stop clients\people from making shares on your server, available offline? Does the server need the file to be enabled for offline access?
If someone can please clear this up.
Thanks in advance