Overall the process works something like this:

Round 1 lines are built based on dad's flying demands which are put out for bidding.

After round 1 is awarded the company applies individual restrictions to each persons individual line. Things like relocation days, vacation, simulator events, additional duties, etc.

Then the SAP is held, it was recently divided into CA SAP and FO SAP to improve efficiency and overall usefulness by decreasing the turn-time on transactions... otherwise known as "PROCESSING." Each pilot has the opportunity to adjust his/her schedule as they desire with minimal restrictions. The cool thing about SAP, as previously mentioned, is that trade transactions are accomplished without the reserve grid or manning in mind. So, yes, every round one line holding pilot has the opportunity to drop via trade Thanksgiving and Christmas. You aren't allowed to straight drop a trip, it has to be part of a trade transaction but you are allowed to trade 8 working days for 4 working days... or 2 working days, or whatever as long as it keeps you FAA legal and you don't drop below 65 hour of credit for the month.

After the SAP, Scheduling takes the leftovers and builds the round 2 schedules for the remaining pilots to bid on in round 2. Those schedules are obviously made up of lines that are less efficient or weekends/holidays, less than pleasurable overnights, or whatever other reason dumped into opentime and picked up by no one. The company builds the reserve grid to cover the additional flying plus their necessary buffer for each day. What that means to the reserve grid is that there will be additional reserves to cover the left over lines after round 2 lines are built. Lets say the company wants 10 reserves to cover Thanksgiving and there are 10 additional lines left in opentime after the round two lines are built... that would dictate 20 total reserves for the day... so when they build the reserve lines they will have 20 reserve assignments on Thanksgiving. All of the round 2 lines and reserve lines are then put out for bidding.

After round 2 there is a Seniority "adjustment bid" which is primarily used by round 2 guys to adjust their schedules or move reserve days. Some round 1 guys use it as well for final adjustments or to pick up flying at 1.25.

That's just a line pilot's simple view on the process... probably slightly misguided, but fairly close to reality.