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lol... a file that contains a bunch of files? is that an archive? or a set of instructions to download a bunch of files? what is the world coming to?

Think of it as a declarative program, you describe the state of the machine as you want it and the nix package manager handles all of the rest.

It downloads, installs, configures, builds and runs from your declarative description. This is my understanding of how nix works anyway.