I will accept this when Scientific American publishes the details.
This is the first I have heard of this, It has taken me about an hour to figure out how this works, as I was as confused as most people as to how this works.
I finally realized that the key is not the apparent wind for the car, but for the propeller. This is the part where everyone, myself included gets really confused. When the car is traveling at the same speed as the wind, and You would think that the apparent wind is zero. But you are only thinking about the apparent wind speed relative to the car chassis, when you should actually be looking at the wind relative to the propeller, which is rotating through the air rather rapidly, and seeing a strong apparent wind.
think of it like this. The propeller blades are like your main sail, on a near reach. They are spinning in a circle. When the car is going less than ~2x the speed of the wind, the wind is directly off your stern. The boat will move, but not that fast. (this is when the car is starting out, and hardly moving, most of the wind force is just pushing the car, there is no airfoil yet.)
As the boat speeds up, the apparent wind shifts, because the blades start to rotate, and you are now operating with the apparent wind, which would be like sailing on a broad reach, and as the apparent wind increases you shift to a beam reach. As the blades increase in rotational speed, and the apparent wind shifts from being astern, to ahead, the apparent wind is now like being close hauled. Eventually as the forward speed increases and the propeller's apparent wind shifts to coming from ahead, it is like pinching instead of reefing in high winds, you are still moving at hull speed, even though the sails are not operating to max efficiency, you have all the power you need. At a point though, the sails will start to back wind, which is what happens to the propeller's apparent wind when the car exceeds something around 3 times the apparent wind.
While they now have a variable pitch prop, the original tests were using a fixed pitch prop, so from the time the blades start rotating, they are essentially fixed somewhere between a near reach and close hauled, with the wind off the beam, and is why the car accelerates so slowly, the blades are not trimmed properly until the car hits at least 2x the speed of the wind.
How does any of this matter? When the car starts out from a stop, it's just the windage of the car that starts it moving, and the movement turns the wheels, which spin the propeller (the key to success being the gear ratio), [*this section is wrong, see the edit below* as the car increases ground speed it soon hits a critical speed (probably between 0.25-0.5 times true wind speed) where the propeller begins to act as an airfoil and spins freely, and induces zero drag on the wheels (allowing the car to speed up by the amount of drag the propeller had been inducing on the wheels), and this increase in the speed of the car will then cause the direction of force to reverse so that the propeller is now driving the wheels,] and propelling the car faster, and simultaneously increasing the speed of the apparent wind while pushing it farther forward increasing the lifting force of the propeller, and thus driving the wheels, until the point where the propeller is over trimmed and begins to backwind.
While I am not sure I am 100% correct on the details in the final paragraph, I am pretty sure that I have the concept down pretty accurately.
EDIT: after some more thought, I realized that the propeller NEVER drives the wheel, the wheels are ALWAYS driving the prop. the forward motion is 100% generated by the lift of the propeller, so my last paragraph is mostly incorrect, but everything else is dead on. I marked the section that was wrong above, but otherwise left it intact.