It's a specific liquid scanner that's done on bottles that have been pulled aside for extra scanning (at least, that's what Frankfurt was doing a couple weeks ago)
At least that was the situation when I flew out of London Gatwick last time - they had people going up and down before the scanners admonishing people to leave everything in their bags to avoid delay.
So, yes, they stay in the bag, but then they're pulled out and scanned separately, at least in Frankfurt.
And yet somehow, airport security staff frequently get impatient when people in line ask whether to remove their shoes, laptop, etc. As if the travelers are stupid for asking.
It'll probably be chaos for the next couple of years while this sorts itself out.