Here's the way it works:
You first generate your primary rank list, which will contain your advanced programs. Assuming you're interested in something like Derm:
1. Program A, Boston
2. Program B, Boston
3. Program C, San Fran
4. Program D, Houston
... etc.
Then, you generate prelim rank lists, and link them with your main rank list. So, you might have a prelim list of:
1. Prelim X, Boston
2. Prelim Y, San FRan
3. Prelim Z, Houston
...which you would link to matches #1 and #2, but:
1. Prelim Y, San Fran
2. Prelim Z, Houston
3. Prelim X, Boston
... which you would link to Match #3
Also, you can finish your primary rank list with prelim programs -- this would allow you to match into a prelim if you don't get an advanced spot. You could also choose not to match at all, and then try to scramble into an IM spot (although that could work out or not)