<p>I open gmail, click on an inbox item, and look at source of the page.  It doesn't look like there isn't any proper html to relate to what is shown on the actual page.</p>

<p>How is the source getting processed into the actual page?  Is there some javascript processing this information?</p>

In IE you get a blank page if you right-click and "View Source".  If you use the Page menu > View Source, you see the actual page source.  As Steve mentioned, in Firefox you see the actual source both from right-click "View Page Source" and from View menu > Page Source.
I suspect they're taking advantage of some IE-specific obfuscation to hide their secret sauce from 85% of the users.