Jeff, I think you are missing the big picture of the phenomenon and concentrate on details.
Look at this from this perspective: the lead forearm clockwise turn in the backswing makes the hosel cover the sweetspot and it remains this way until the anticlockwise forearm rotation happens in the downswing. If the clubhead rotates around the shaft/hosel it would mean that both the hosel as well as the sweetspot goes out of plane together with forearm rotation back.
Observe carefully your takeaway and you will see that the club rotates around the sweetspot (precisely, as NMGolfer said, around the club's CoG).
The same must happen in the downswing phase.
The scenario when the club rotates around the shaft/hosel is possible only when the club's CoG is in line with the shaft - as in case of theoretical center-shafted clubs.
As per YodasLuke pictures - I think the most misleading is the pic no.2; in this position the hosel and the sweetspot should ideally be on the higher inclined line that signifies the sweetspot at address.
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