Another way look at the same concept, and one that many people find easier to understand, is to consider the simplification that a "good shot" will gain more than 1.000 strokes, while a "bad shot" will gain less.
For the most obvious example, take a 400 yard par 4 with a stroke average of exactly 4.000.
Player 1 swings and misses. He has taken 1.000 strokes and gained 0.000 strokes, so his shot gains -1.000 strokes driving.
Player 2 duck hooks OB. He has taken 1.000 strokes and gained -1.000 strokes, so he has lost 2.000 strokes driving.
Player 3 holes out off the tee from 400 yards out. He's taken 1.000 strokes to make 1 on a hole where he's expected to make 4.000, so he's gained 3.00 strokes driving.
Using this same method, consider the following (on the same hypothetical hole, with all figures approximate):
Player A tops his drive 20 yards in the fairway - he's used 1.000 strokes but since he's still expected to take 3.900 strokes to get down from 380 out in the fairway, he's lost 0.900 strokes to average.
Player B hits his drive 250 in the fairway. From 150 in the fairway, we expect him to take three shots to hole out. So he's used 1.000 strokes and gained 1.000 strokes relative to the hole overall, for a net of 0.000 - a perfectly average drive.
Player C hits his shot 300 yards into the rough. From 100 yards in the rough, he's expected to take 2.500 strokes to hole out, so he's used 1.000 strokes and gained 1.500 strokes, for a net gain of 0.500.
Player D hits his ball 270 down the middle. From 130 in the fairway, he's also expected to take 2.500 shots to get down, so he's also gained 1.500 shots while using only 1.000 strokes, again for a net gain of 0.500 strokes.
Player E hits a 370 yard drive into a hazard, necessitating a drop at 50 yards from the hole in the fairway. From 50 yards out in the fairway, he's expected to get down in 1.500 strokes. So despite the fact that he's taken a penalty, he's also hit a "good" drive and gained 2.500 strokes while using only 2.000 (4.000 strokes expected minus 2.000 strokes used minus 1.500 strokes expected from new position equals a net of 0.500 strokes gained).
The problem with traditional stats is that they regard player A, B and D equally (one fairway hit - despite the fact that we know objectively that player D hit the best drive) and player E worst of all. All strokes gained allows us to do is see that while their drives vary in result, players C, D and E have in fact all hit good drives and have gained 0.500 strokes over the average of the field.
Now, bear in mind that player C could hole out from 150 (1.500 net gain on approach), player B could get up and down (0.500 net gained, most of it on approach if he stiffed it close, on putting if he's outside 15 feet) and player E could take 7 to get home (a net negative 5.5 split between approach and putting in some way), but it doesn't change the fact that all three gained a net of half a stroke to the field with their drives.
The whole point of the these stats is that we can see that and measure it, regardless of the actual score each player posts on the hole.