Where does imaging come from?

I understand the physiological part, but my question is how is the information coded at the studio for imaging to occur? Especially in sessions where all the artists are recorded individually...

Is it a simple matter of the studio engineer using a "balance" knob (to create left-right imaging) in conjunction with a volume knob and a basic effect knob (to create depth), much like on a stereo?

I always thought that the "Imaging Fairy" sprinkled it on your system??? :)~

Yes, it's like using a balance knob on the mixing board. It's called "panning".

so panning accounts for left-right axis imaging and volume accounts for depth?

Dubzilla, what you described above - balance, volume, effects - are all part of audio engineering. However, there is a lot more to audio engineering than just panning, volume and effects. Depth, height, air, etc is heavily dependent on miking/recording technique. This is how the real imaging magic is captured.

Without good miking/recording technique, mastering can only go so far...