But How is it making the levels the same? Are you certain it's not using some form of compression to do so?
It analyses the average loudness of each track and applies an overall gain increase or reduction depending on the result. It doesn't alter the sound, it just turns the volume up or down on a per track basis.

It's similar to ReplayGain (http://wiki.hydrogenaudio.org/index....tle=Replaygain), in fact I suspect Apple may have used some of the same techniques.