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They work on the same principle as those oscillating tools they use to cut off plaster casts without slicing through the quivering flesh beneath. In fact, I think I read somewhere that those medical tools were the precursors to the multitools we all know and love.
Sharkstar-
Yes, they refer to it here.
https://fein.com/en_uk/fein/company/history/
Apparently the multi tool was based on an automotive 'chassis saw'. Turns out the first application was removing glass from silicon in cars.
Airhead
I had a demo once and the guy showed me. I'm pretty sure you could cut yourself with the blade but when it's oscillating for some reason it doesn't. Cue pictures of severed fingers etc.
Try it at home (at your own risk etc.)