[RKDinOKC]

Okay here is how it works...

Everything on the internet is accessed via a public IP addresses.
Your service provider provides you with a modem/router.
A router sits between two networks and routes traffic between the two networks.
If an IP address is not in your private network, ie not another device on your private network, the traffic is directed to go thru the router to the public realm.
Because the device has a private IP it is translated to the public IP of your router.
All traffic to outside your private network uses the public IP of your router.
Your router keeps track of which connections to outside devices go with which private device.
This is called Network Address Translation or NAT.

Next is a secure server.
When you connect to a secure server your traffic to an from that server is encrypted. There is a trust relationship with the server having a certificate from a certificate authority proving it is the server it says it is, then the connection is encrypted. This happens BEFORE you login with username and password so that information is encrypted. However it still shows there is traffic from your public IP to the IP of the secure server. It is just that the data is encrypted.

A VPN or Virtual Private Network.
A VPN is a router that connects with your private device like a secure server.
It establishes an encrypted connection between your private devices and a Private Network that can be a range of IP addresses. If when connected to a VPN all traffic to the IP addresses in the range of the VPN are routed encrypted thru the VPN router to that network. And example would be a VPN encrypted connection to a firewalled network at work.

VPN Services
This is like a VPN only that ALL your traffic is encrypted to a VPN server, then uses the VPN service's public IP addresses and are unencrypted from there. That is why it works for Georetricted network servers. The VPN's public address is in the range off addresses for the locality you want to access the georestircted servers so it looks like a local IP address to those servers. The encrypted connection between your device and the VPN keeps your ISP from seeing anything except that you are making a connection to the VPN server. Even though you are using a VPN you still have public traffic from the VPN server to sites you visit. To remain anonymous you need to make sure the VPN service does not keep logs of the NAT tables used for their VPN traffic that can be traced back to your router. And just because you are going thru a VPN does not mean it will protect you from visiting sites with malware.

There is a hack out now for wi-fi networks with security and encryption. The hack is in the establishment of the connection and the hackers can monitor your traffic just like it was not encrypted. That is why you want to be very wary of any wi-fi offered when you travel. And keep your devices and wi-fi routers up-to-date!