Speeding up of the above process by the presence of such as walls, carpets etc. stimulating the decay process. Oxidation reaction with odor causing organic material, which removes ozone. Reactions with bacteria etc., which again consumes ozone by oxidation reactions. What this means is that after each subsequent 30 minute period there would be half as much residual ozone left at the end of the period as was present at the beginning of the period. In practice the half life is usually less than 30 minutes due to bacterial and other contaminants in the air.
Ozone destroys the source of odor.
However, in the case of mildew the odor will return if you are unable to get rid of the moisture that is the source of the mildew. It eliminates the irritation caused by phenol gasses, by oxidizing them. Phenol gasses are the invisible part of tobacco smoke that causes such discomfort to one's eyes and create the offensive odors. No, ozone will not remove the stains or nicotine build up. Ozone will deodorize and help to decontaminate the problem but will not remove the actual substance.