Everyone waits in line together once. When you approach the loading area you tell a cast member that you would like to take advantage of the Child Swap. CM asks who's waiting and who's riding, those waiting are taken to a side area to wait. Those riding continue on to loading area. When you return from the ride, tell the CM you are part of a Child Swap. They will direct you to meet up with waiting members of your party. Child that isn't riding swaps between party members and those that waited are directed to the loading area. You do not have to wait for other party members to return from their ride before you leave through the exit.
We have used this a few times and our older child was able to ride with both parents, so DH and I each rode with older child once, older child able to ride twice total, and younger child waited with each parent once. When my ride was done I took younger child out to get ice cream while older child rode with DH.
Hope that helps!