We just got back and used the swap on everything. We had DS10, DD7, DD4, and DD1. For most of the rides, you all go up to the line entrance together. That way, they see that you do actually have a small child that is too short to ride. CM gives you a "rider switch" pass, then one parent gets in line(FP if you have a FP or stand-by if not) with the riding kids and the other parent does whatever they want while waiting with the too-small kid(s). When the first parent is done, the second parent uses the rider switch pass to go through the fast pass line(whether or not you have a FP) with up to 2 other people.
For most rides, it's not really any different than using FP's, except you can use it in addition to FP's and it means up to 2 older kids can ride twice, once with each parent. My DD7 and DS10 got to ride almost everything twice in a row because of this.
Some rides, like Star Tours and Primeval Whirl are different, in that the second parent doesn't use the FP line, but instead the whole family goes all the way up to where the ride loads and waits there. So as soon as the first parent gets off, they swap the baby and the second parent gets on. On Star Tours, you actually take the baby onto the ride as soon as the doors open and hand off to the first parent before they exit.