"How does the system switch from panels back to grid? Does the power for the whole house go off for a few seconds and the switch occur? Are there smart entrances that keep locally produced power in synch with the electric company and seamlessly change over on one of the 60 cycle fluctuations?"
Without batteries, there will be some switchover, but should only be a second or less in most cases. It's just a contactor switching from source A to source B and back.
With batteries, the change would be seamless since you're running off the batteries and the source change is what's charging them. That may vary based on system design, but what I've seen is the batteries act as a filter/UPS to work against fluctuations.
Solar is useless at night and very ineffective on cloudy days, so without batteries, it won't help you much.
A full system is a combination of utility, solar, wind and batteries. Maybe a generator too.
With my 16Kw generator, there is an automatic transfer switch (ATS) that monitors utility power. When that fails, the ATS senses the loss, sends a command to the generator to start and waits a few seconds for it to come up to speed and stabilize, then switches. Power loss to the house is generally about 10-15 seconds. UPSs on various devices can easily carry that.
When utility power is restored, the opposite happens. Switchover is first, then the command is sent for the generator to shut down.