In fact, what you observed is correct. However, there is a detail that I believe may not be obvious. That detail is the FluidContentControl. It is a standalone control that can be used without a TileView and there is no requirement to use one within the other. Using the two is simply very handy and that is why the online demo does so. Now I see that this can actually be a bit misleading by leaving people with the impression that the FluidContentControl is a part of the TileView or is somehow required by it.
Anyway, when a TileViewItem is changing its state, it is only changing its size i.e. the TileViewItem is not doing anything with its content. It is the FluidContentControl that is switching its visible content as the available size changes. You can find a good explanation of the FluidContentControl here:
Hopefully I was able to make things a bit clearer. Please let me know if you have any other questions.
the Telerik team