How exactly does a pitch sale work Scott?
Someone goes to a producer/studio, pitches an idea, and then gets paid money to write subsequent drafts of that pitch?
Or do they get money for just the pitch and then additional money for drafts?

Matisse, here's how it generally works. A writer will work up a pitch. Either they will do it on their own and their reps will attach a favored producer for each studio (typically ones with an overall deal at that studio), or sometimes there is one producer attached to the pitch that goes wide to all the studios.

The pitch is done on spec, just like a spec script.

If a studio agrees to buy the pitch, the writer's reps negotiate the fee for the project. Those fees are writing fees, hopefully (for the writer) for a first draft and rewrite, although the studios nowadays, at least on open writing assignments, are trying to get rid of the implied rewrite as part of the deal.

More and more, reps attach other talent to pitches, primarily actors, but sometimes directors to give the project more heft per the studio and ostensibly closer to a green light. That varies from project to project as some pitches are so high concept and have such wide casting possibilities, it's better not to attach talent.

BTW, the purchase price for a pitch is generally tied to a writer's quote, how much they typically get for a writing assignment. That can change hugely in the case of a bidding war, in which case all bets are off, and the numbers are determined by which studio is willing to pay what.