In a nutshell: The iPhone seems to do the following internally for SIRI:
- Access your address book, calendar, contacts, reminders, etc.
- Does audio capture and probably some of the basic speech recognition, equivalent to what is done on the iPhone 4.
If the phone needs to access any external source for your answer, then it goes to the cloud for that. This includes:
- Movie listings, locations of things, weather, stock quotes, directions
- Math Problems, Wolfram Alpha stuff, Yelp reviews
- Witty joke responses
- Any situation where the phone can't figure out what you're asking it.
It does seem like SIRI hits the cloud for nearly every request though, and then the request gets bounced back if it's determined that the information it needs is on your phone. Or, it could be accessing iCloud to get what it needs. THough, I have used it to set appointments on my calendar that it placed on my non-iCloud, work-based Zimbra calendar.