The router has a cutter with a bearing on the bottom that you keep in contact with the wood, so the cutter rounds off the edge above it.
Its very important to keep the bottom of the router flat to the wood - otherwise the edge isnt completely rounded, and you can knock off the bits you just glued on.
I knocked one off showing him, then luckily, he knocked off another so I didnt have to feel completely silly.
He is rounding the edge of the cutout.
The side is coated, the lumps are covered in microfibres..
Debating screwing the lumps on, but decided against it.