As far as I know it identifies and changes variables in your game files, so that you could say, give yourself infinite gold in Skyrim.
not trying to be a cunt but what you just described is literally what cheating is
cheating:act dishonestly or unfairly in order to gain an advantage, especially in a game or examination.
also unbans usually only happen if it's just a mistake by the system (say, if you're running new hardware steam doesn't recognize), you can get unbanned by other means but usually you need some sort of evidence