It works by following the world seed, unless a player commits a "World Changing Action." This sound dramatic but it isn't really, some examples include Asking a Cartographer for a map to a specific structure, completing a puzzle, finding a map on an npc, defeating a boss, etc. Then the world will make an adjustment to the seed, calculating the most likely place for that structure/ biome to naturally generate and it forces it to generate there. The map could then generate an appropriately sized biome in that area and blend it in with the seed and place your structure(s) inside if need be.
This small change would have so many possible things they could do with it. A simple example would be having a player go up to a cartographer and give them the ability to ask them if they know where a certain biome is. Then for a fee the game generates an approximate map to the biome. At that moment the game decides to generate that biome just outside previously generated terrain, in the most natural place available given what has already been generated.
Take this a step farther and say some biomes/ structures/ items/ mods/ blocks can't be generated unless the player has done one of those World Changing Events. This would work great for things like the End Stronghold. What if instead of using ender eyes to find the pre-generated structure, you had slain a boss that unlocked a chest containing the map to it. After which the game generates the structure and alters the seed. You could make whole questlines with this. What if that boss was in a structure that was only generated after you finished a puzzle? And that puzzle structure was only generated after you discovered a village and the villagers told you about strange noises coming from "the north". And so on.
The benefits to this kind of change would include allowing players to have biomes they like closer to one another if they knew what they were doing, allowing for questlines guaranteeing players complete them in a specific order, and it would give the developers more control over the generation of the world.