Gmail delete mail issue

I'll explain this best I can. I have not been able to delete Gmail (imap) from iPhone 4. I have Gmail ticked to sync Calendars and Mail. Below, under Google Sync (Exchange) I had it ticked to only sync Calendars. I just tried ticking Mail there too and it finally, phew, worked. I can now delete email from iPhone. What did I do actually. I am a bit confused just what is exchange, and what it is and does. Issues solved but do not understand why. Also, where does deleted mail from iPhone go, it does not seem to be in Gmail trash.