Anyone know how this works? I mean, as a customer, I never see an option to rate how helpful a particular review is. Is Apple actually reading through every user review and promoting the good ones...?!
Um ... every single review at the App Store ends with "Was this review helpful?" and then side-by-side buttons that say "Yes | No."
Yes, that's why. The next time you go to the App Store from your PC/Mac, you'll see the voting area at the bottom of every review. To answer your original question, it appears to be a straight "one point per vote" system. A yes vote equals +1; a minus vote equals -1; the most points is listed as the top review. (Which, BTW, is why I much prefer to sort them by "most recent"; I've found the alleged "most helpful" reviews to not be very helpful at all).
LOL I didn't even notice it until you pointed it out, so I really have no idea. It would seem to be a very natural thing to rate apps using the very device you're going to use them on, wouldn't it?