Understanding the Transactional Nature of Smart Contracts

In this post I attempt to summarize my understandings about the transactional nature of Smart contract execution. I conducted this study, while trying to understand the DAO exploit. The basis of the DAO exploit is a recursive(or rather reentrant) message call. One important point to note that an exception(during a message call or otherwise) in the Ethereum Virtual Machine , would imply reverting all changes to state and balance. Solidity has a documentation on cases where exceptions are thrown automatically. However in certain cases like send we need to manually raise an exception using throw. So, the attacker has to be careful not to hit any exceptions while attempting the reentrant call to avoid reverting. I also rectify certain mistaken assumptions, I made in my previous post.