Exe Encrypter/Packer

This is my first post to the forum..

Anyway I was wondering if any people here could help me understand how exe packers and crypters work. I get the basics of it that a packed exe
includes a loader stub & then exe data; the unpacking process is what
I don't understand, is the program unpacked to disk and run like that or is it
launched from memory (how?) also when a file is being packed is anything removed (Like the header).

Thanks for the help.