Can anyone comment if i have it write or wrong on how the expansion bottle works.

There is a black rubber seal which fits over a white round disc mounted on a spring arrangement in the black cap which then screws onto the expansion bottle. When the cap is fitted the black rubber seal is located in the neck of the bottle, sealing off the overflow pipe.
When the pressure builds up the rubber seal is forced up compressing the spring which then allows the excess pressure to flow out the overflow pipe.
Would this also mean that the coolant is in a pressorized system?

spot on davo, the whole plastic tank is pressurized thats why they sometime split,
unless you do the honda CBR600 conversion

Davo,
Where are you located"?

Hi Jaffa, I`m in Geelong