Essentially, clients create sync items via myPlex endPoints. The server picks these up and performs the conversion. Clients then talk to the media server to retrieve the tree of metadata and converted media.
In terms of “auto-syncing” new unwatched TV shows, this is the sort of thing that is supposed to already be supported. If your client syncs The Walking Dead (unwatched, limit = 3) you’ll always have the next three unwatched episodes on your device.