Well, I'm no expert at explaining the details on how or why...but I dive the seven foot hose and necklaced backup. I find it makes handling an out of air diver situation much easier for me.
The long hose regulator system is based on the idea of donating the Primary regulator to an out of air diver rather than the octo. The idea is to donate the regulator that is known to be working. For me it's much easier and much faster to reach up and grab the primary and give it away, than to fumble tugging out or unclipping the octo to donate. The long hose makes any movement after donating such as an ascent, fixing problems, getting out of a cave or wreck, swimming back to the anchor line, much easier because you have the ability to get some distance from the diver you donated to. There isnt much room with just thirty inches or so between the two of you as with a standard reg setup.
The backup regulator is on a short (22" or so) hose and it is hung under your chin with a necklace of some sort. SOme divers make the necklace out of bungy cord, some use surgical tubing, some buy the rubber necklaces that come with a hole for the mouthpiece molded in it. Personally I make mine out of bungy. With this secondary reg right under your chin, you dont have to look for it when you donate the primary. It's right there. Some divers are set up so nicely that all they need do is drop their chin and they can get their mouth on the reg without using their hands!
With this setup, fumbling is pretty much eliminated. The way the long hose is routed around the body, all it takes is to slightly tilt your head forward when donating and the hose slips easily over the head. Some folks think initially that the hose is stored wrapped around your neck. This is NOT the case! What happens is that the hose comes off the first stage and down your back behind your right shoulder. Then it curves up under the right arm and across the chest. From there it goes over the left shoulder and behind your head to your mouth. The hose sits on the back of your neck and never makes a full circle around your neck. The excess length is handled by either tucking the loop made at your right hip under your can light if you have one there, or under a pocket if you have one, or as most do just tuck that loop under the waistband of your BC or BP/W. By adjusting how much of a loop you have tucked you can get the hose to ride comfortably.
I'm sure more knowledgable folks will reply soon...but theres something to chew on!
Also, dont hesitate to use the search feature up there at the right hand corner as this topic comes up very often.
This link points things out pretty clearly as well.
http://www.sfdj.com/hogarthian/shot4.jpg
Here's a photo too...probably more clear than my convoluted ramblings!