What does washing do

Yes that's correct,it also simulates grime and dirt build up in the corners and on the details

What type of washes you use depends on what type of paints you use. For cockpits i use a chalk pastel wash. Thats because i use enamel paints and these don't take well to an oil wash without somthing like future to protect.

Because of the nature of surface tension, very dilute washes tend to deposit most pigment in grooves and inside angles, the same areas that dirt and grime collect in.  This adds to the weathered effect.

On the other hand, dry brush effects tend to concentrate on ridges, high spots and the like.  So the two are complementary.  A dark wash and a light color (especially aluminum or steel) as a dry brush go together very well.