These players are called anchors because their ranks never change. Then it gives ranks to those who play the anchors, based on their scores against the anchors. Then it looks at people who played the earlier group of players, etc. The ranks are recalculated every hour on the hour. After your rank is recalculated, you must log out and then back into NNGS to see the changes.
Ranks occur in a continuous scale, but are split in two parts.
You can think of the kyu ranks as negative numbers and the dan ranks as positive if it helps your understanding. Thus, a 25 kyu is weaker than 10 kyu, and 1 kyu is weaker than 1 dan. For example, 15k and 5k are kyu ranks, while 2d and 5d and dan ranks. In general, if one player's rank is x higher than another, then a fair game would give x stones handicap to the weaker player. For example, if a 10k wants to play a 5k, the 10k should take 5 handicap stones to give both players an equal chance to win.