What do they do when they spade dogs?

It's an ovariohysterectomy. They remove the uterus and the ovaries during a spay procedure. It's considered routine and recovery time doesn't generally take very long since they deal with things like that much better than we do and have a higher pain tolerance (though pain meds are used the first few days after the surgery). They are usually back to normal within a few days to a week and the stitches are removed in about 10 days are so. 
Most females that aren't spayed sooner end up having to spayed later in life due to some emergency or problem that is a direct result of not being spayed sooner such as uterine infection, mammary cancer, polyp/tumors, prolapsed uterus, metabolic/endocrine disorders or complications from pregnancy/breeding. An unspayed female has aprox. 40% the life span of a spayed female as a direct result of not being spayed.
We also don't have to worry about all the mess and stress and headaches of a female in season when they are spayed as they need to be kept under lock and key and constant supervision during season to prevent an accidental pregnancy as an additional benefit to us. There is more information for you about spaying in the first link.
http://www.irvinevetservices.com/education_spaying.php q8177327.html
http://www.wildheirlabradorrescue.org/readingroom/what-is-a-back-yard-breeder.php
http://www.petfinder.com/index.html