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The real answer is in SkinnableContainer.as
SkinnableContainer.as provided a bit more insight, but does not answer my questions:
1) What are the implications of NavigatorContent creationPolicy being none in
this case, because its children still get created.
2) Why does it inherit a policy of none if the TN has one of auto? I saw how
this is done in NavigatorContent.as, but why?
It did not answer the question of why the controls are still created. I would think they would not be created with "none".
I guess they set it to none so other controls don't inherit "auto"? Not sure about question 2 as well.
There are apparently some issues with how MX containers live in Spark
containers and vice versa and this code seems to do some tricks to make it