IM: OS Utilities Start Manager chapter has a section on Boot Blocks.

The first two logical blocks on every Macintosh volume are boot blocks. These blocks contain system startup information: instructions and information necessary to start up (or “boot”) a Macintosh computer.

Click to expand...

Among the information the BootBlkHdr contains is the system and finder files.

Apple used to distribute System Picker on their developer CDs, and there were other utilities out there to do the same thing. It was useful to developers when testing out beta OS releases. I've used it quite a bit and have not had any problems. However, I would recommend rebooting after altering your boot selection, since that will update your boot blocks, and other utilities may get confused as to which System Folder you're currently using.

AFAIK, this is the same mechanism used to switch between booting OSX and OS9 on the same volume.