Does the oil get funneled throught the cooler, allowing it to get "kissed" by cool air, or what?

Ayup.

As I understand it, an oil cooler works just like a radiator by multiplying the surface area many times. As you say the oil is funnelled through horizontal tubes to which many fins are attached -exactly the same as the principle behind the fins on our cylinders.
A good analogy would be a bowl of soup will cool in seconds if you poured it on the floor but it would stay hot much longer if it was kept in the mug or bowl -because the surface area is greatly increased.

Mmmmmmm.....soup.

doh!

Actually, I think you'd say that the air cooler gets.. blown rather than kissed.

-Rusty

Mmmm... Open Faced Club Sandwedge.....