Spirits come from the "other place" that the Gods dwell in. Mageblooded refer to the place as "Beyond the Gate". Commonly, it's also known as the place beyond the Veil. Therein, spirits manipulate magic like we here manipulate matter. One definition used in the material world for a spirit is "anything you can see with your eyes closed".
There are societies of the spirit world, just as in the material world, but they match up with their "real world" cousins in a few respects. The gods themselves may be just very, very powerful spirits. Some of the societies of spirits are hierarchical in nature. The gods maintain minions of various levels of power and responsibility.
Though there are many names, spirits with a bent inimical to mortals are known generally known as demons, while those benign spirits are called angels. Neutral or indifferent spirits are called, well, spirits. But any denizen of the spirit world can be generically called a spirit.
Spirits (gods) get power from the material world somehow - from worshipful mortals, the dedication of a soul to a spirit at death, and from change in thought and behavior of sentient morals. (Thus spirits' willingness to negotiate!) Gods are in a contest to win mortals' hearts, minds and souls -- from which they get more power. This war in the heavens becomes war in the mortal world as spirits direct and influence mortals to their will.
Aside: In some sense the greatest fear of the gods is to be forgotten and/or dismissed. And so all mageblooded folk are in some sense dangerous to the spirits, because they put the ability to work magic in the hands of mortals without the influence of spirits!
Spirits want to be incarnate. When in material form, a spirit has a particular NEED that it seeks to have met in the material world.
The entire gamut of mortal endeavor, and the mortal world itself is of burning interest to any spirit, but they tend to gravitate to particular activities and areas, and thus, a NEED.
In addition to their particular Need, all spirits share the desire to experience being incarnate, the desire to influence mortals, and in particular, the desire to influence their summoner. If a spirit isn't "fed", by having its Need met, it eventually grows weak and its mortal form will perish, sending it back to the spirit world. Along the way, it will become very rebellious, angry and dangerous to its summoner (and everyone else, for that matter).
Not all demons and spirits have equal power. Much like any other character, spirits have a Karma score, which is a rough measure of the spirit's dramatic power and signficance to the story. This relative score is also indicative of the spirit's ability to work magic. A demon with a high Karma can work magic so far beyond the ken of mortal minds that they might well be considered gods.
However, even small demons all have a form of limited polymorph - they can shapeshift in and out their one "key" form while in the material world.
Can be used to chat with a demon without bringing it to the material world. Minions of benign/Lawful gods or spirits are generally friendly and willing to take calls from mortals. Not so random other spirits, especially those aligned with Chaos.
Draw a "pentacle", whose lines a demon cannot cross. The difficulty is related to the size of the ward. Never reveal success/failure to the summoner at the time the ward is drawn. Doesn't have to be a literal pentacle - could be a smoke smudge, a special song, whatever.
A failed attempt means that the demon isn't contained within the ward; the demon can cross out of the ward, across its boundaries. Ie., to kill the summoner. Although it may choose not to even let on the that ward is faulty.
Note that cautious summoners will ward both the spot the demon is summoned into, and around themselves.
Summoning ALWAYS works.
Read that again. A summoner will ALWAYS summon a spirit, even if the summoner "fails" miserably.
Spirits (despite what they say) WANT TO BE SUMMONED, because they want to experience corporeal form - the sensations and experiences of being incarnate. Moreover, they want to influence the actions of mortals, and in particular the summoner. Finally, each has a worldly, material Need they want to have met.
However, as the GM, always resolve the attempt using the usual methods. The success or failure of the attempt then goes down to the influence the summoner has over the spirit. Ie., if the summoner flubs the summoning, it means that the spirit will demand more, and generally have the upper hand in all future interactions.
Generally, summoning a spirit is considered a task of Good difficulty (more than 2 successes needed). Simple/small/weak spirits might be only of Fair difficulty (more than 1 success), which powerful demons might be Great difficulty or higher.
If the summoner uses one of the demon's spirit names (or even a true name), it grants a bonus of +1 to +3 successes. Ditto for doing the summoning in a place of power, along a ley line, etc. Also, various other summoning techniques may have greater or lesser effects (which may vary from daemon to daemon, and technique to technique), granting a bonus or penalty ranging from -3 to +3 successes.
In all cases, when the summoned spirit's Karma is higher than the summoner's, the summoner needs an additional success.
NOTE THAT A SPIRIT WILL ALWAYS APPEAR, even if the summoner fails the attempt. A "failed" summon simply means the spirit has the upper hand.
Once a spirit is summoned, it can act of its own agency, including returning to the spirit world, killing the summoner, fireballing everything in sight, etc., unless it is inside a ward. If inside a ward, it's stuck (and can then be coerced or bargained with for a Binding). Wards last a limited time. (How long?)
A summoned spirit remains in the material world until it is Banished, dismissed by the summoner, its Need goes unmet for long enough (How long?), or its material form is killed or destroyed.
In addition to the above, each time a summoning is made, the sorcerer faces the possiblity of being corrupted by the supernatural forces with which she deals. This corruption is permanent, cumulative, and eventually results in the summoner becoming psychotic.
The task of avoiding this corruption is the same difficulty as the summoning task itself. If the summoner fails, she earns a trait of "Magical Corruption" at Average. Each successive failure raises that trait one level on the character's trait pyramid. A character with a Corruption trait at Superb (+5) has lost her mind, and becomes hopelessly (and usually violently, dangerously) insane.
Such an insane summoner has possibly become the thrall of an extra-planar demonic force. She henceforth is a non-player character!
Bind always works - or at least apparently works.
Once the summoner has a spirit stuck (hopefully!) inside a magic circle, he can attempt to get it to do his magical bidding - to cast spells, wield magic for him, and generally do his bidding.
While in a magic circle, a spirit may not lie (although they may not have complete information), and will be bound to any agreement that they make with the summoner, to the best of their ability. Conversely, a summoner is perfectly free to not hold up their end of any bargain they strike with a spirit. (Although this may have grave... very grave... reprecussions.)
Generally, a spirit's KARMA level indicates its general ability to work magic in the mortal world. So, asking a piddly Karma 1 spirit to raise the dead can (probably?) never succeed, even though the daemon may agree to try, and if bound, will attempt to carry out the summoner's wishes, to the best of its ability.
Summoners can use three means to persuade a daemon to work magic for them:
In negotiations with a spirit, the summoner offers an exchange. Each spirit has a particular Need, and has interests and motivations of their own, and will ask for the summoner to do something, such as sacrifices, quests, taboos, etc.
The gamut of such agreements runs from a blanket all-in-one to an "a la carte". In other words, with the right relationship between summoner and spirit, the agreement may be as simple as "I agree to meet your Need as long as you do my bidding truly and faithfully to the best of your ability."
On the opposite extreme, an example of an "a la carte" agreement might be that the spirit may agree to put the summoner's enemies to sleep when the summoner shouts the code word "Pickleblitz", but each time the spirit does so, the summoner must spend the very next night sleeping nude, under the stars, on a bed of scorpions. If the summoner does not comply with the spirit's demands, it will be much harder negotiate with that spirit in the future, and or/the spirit will demand extra sleepless (and stung) nights.
A demon with the upper hand from a failed summoning will definitely demand more quid pro quo in negotitations and in subsequent service to the summoner.
A bound demon is stuck in the material world, and can't return to its home until: a) it becomes unbound (death of summoner usually suffices, though not always), b) it is banished/dismissed, c) its mortal form is killed, or d) its need goes unmet for a sufficiently long period of time.
Generally while in the material world, spirits choose to remain invisible, or to cloak their true nature in a mundane form, via a polymorphic magic.
Spirits prefer to use their incarnate forms (which can be very powerful) to accomplish the goals of their summoners, because it meets their need to experience incarnate form. Thus, when asked to ascertain the whereabouts of his master's nemesis, if unbidden otherwise, the spirit would prefer to polymorph into an eagle, and fly over the nemesis' territory, rather than use a magic effect such as scrying.
Banish is the opposite of summoning, and is always one level of difficulty easier than summoning for a demon bound by the summoner. Someone else's spirit can be banished, but it requires a physical touch to the spirit to be banished, and it is a task of Great difficulty (+3).
In rough order of increasing Karma:
Other commonly used words for spirits include: genius, numina, revenant (vengeful spirit of the dead), shades and shadows, outsiders, others, devas, paragons, primordials, quasits, dretches, dao, gen...