The video card is mostly used to decode input video, ex if your source videos are mpeg-2 or h264 then the video card decodes and sends raw video frames back.
This is sometimes done with a dedicated part of the gpu chip that's highly optimized for video playback and is basically independent of the gpu (it uses its own resources, not shaders and gpu part that's used for games usually). These hardware video decoders can do more than real time but not much more, usually 50-70 fps.
What slows down things is transferring of the images from this dedicated area to the regular video card memory or to the computer ram.
Less often, the video card is also used to do color conversion, resampling/resizing to different image size etc ... Now you have to convert the image to a texture format, upload it to video card, compile the shaders or cuda/open cl code, download the texture from the video card... again lots of time wasted
Even less often the video card is used to do a part of the encoding with the rest of the encoding being done on processor.
Unless you use a preset with high-extreme quality options, most often these parts are faster to be done in cpu than on video card.
x264 for example - the open source video encoder in Handbrake - only now added an option to do some motion analysis and encoding on the gpu but a large part of the encoding is still done in CPU.. you can read a good explanation here:
https://github.com/DarkShikari/x264-devel/commit/c902b90bbb6846471a6f22f7377782c89da3052fBasically, like he says, the little that's done in gpu, is done using a more stupid algorithm that has to do more work than the cpu version, but since it's extra free resources it helps sometimes, leaving the cpu free to do more work.
In Sony Vegas, I suspect that the cpu simply waits after the video card to get the decoded frames or to finish whatever part of encoding it does on gpu, because the constant rate factor presets are just too easy to encode.
It may be faster than using cpu alone because the gpu may still decode more frames per second compared to whatever the cpu would be able to decode in a second, when other threads also hammer it with the encoding part.
Oh, and there may be other things in play...
With cpu encoding alone, the cpu may be hotter constantly so the laptop may throttle itself down, thereby overall the encoding would be slower.
With gpu decoding, the lower cpu usage may be just low enough not to throttle down the cpu frequency, and it may even give the cpu opportunity to go turbo and raise the frequency of 1-2 out of those 4 cores.