damping of speaker enclosures

A have some more questions about this and didn't want to completely hijack the Sony thread...

johnc said:

Ian, what exactly is the purpose of the dog blanket and is it effective?

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JimGore said:

It damps the sound and standing waves inside the cabinet.  For the price it is probably 1000% more effective than anything else.  I use it in every speaker I build.

Regards,
Ian.

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Byrd said:

If you want them louder - don't use damping - but then they will probably sound a bit horrid.

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Can either of you clarify more specifically the purpose of the dog blanket?
Does it damp:
  1. The driver's movement?
  2. The movement of the walls of the box?
  3. The sound inside the box?

Ian's statement suggests the answer is 3.
I would understand Byrd's comment if the answer was 1.

What is the mechanism by which the dog blanket absorbs sound/driver movement/wall movement?
Has anyone done a comparison between using dog blanket and not using it to quantify the differences?

My subwoofer box has undercarpet (like dog blanket) on the walls and I can't say whether it helps.