I think you pretty much understand work and turn. Basically what they do is make one set of plates with the backs and fronts of your flyers all on the same plate. They print these plates on both sides of the sheet of paper so that the backs and fronts of the flyers line up. This means that instead of having to make eight plates for full colour flyers (four for the front and four for the back) they only have to make four (one set that contains front and back).
Effectively, you will get two flyers per design, so if you need 5,000 of each design on the sheet, the press only needs to run 2,500 sheets. This does mean that you can get fewer unique designs per sheet - you can fit 16 unique a6s on an SRA2 doing it sheet work, but only 8 unique A6s on an SRA2 doing it work and turn. If your press has a B1 press, then they could do 18 unique A6s work and turn.
You certainly can mix and match flyer sizes in this manner. The conventional layup method is to place the fronts of your flyers on the left hand side of the sheet and the backs on the right hand side. So, say you have an SRA2 sheet to print on, you effectively have an A3 worth of space to divide up into different size flyers (One half of the SRA2 for the fronts, one half for the backs). Within that space, you can divide it up into different size flyers as you see fit. So if you can fit 8 A6s on, you could fit 16 A7s or 4 A5s or a combination of 5 A6s, 1 A5 and 2 A7s etc.
However, remember that you can't surround a flyer with other flyers with no route in from the edge of the page for the cutter, so you have to square everything off; you can't go crazy paving odd size flyers all over the sheet. It is ok for a cutting line to only be accessible from one edge, though, so you can place two a6s alongside an a5, for example.
Hmm. I do this everyday so it's second nature too me, but I'm not really if this will make total sense or not.