[Jeff_Brown]

That video is of Mike Hodnick, not myself. But to answer your question, the timbres are generally a combination of both things you mention. At its core TidalCycles triggers synths and samplers in SuperCollider. It also controls the effect chain they go through, though, so you can pattern "clean DISTORTED clean clean DISTORTED" as easily as "kick hat snare hat". And sufficiently high-frequency control of the synths will have timbral consequences, too -- alternate, for instance, between two constant frequencies sufficiently quickly and you've built a simple FM synth.