The coolant circulates due to convention when the block heater is on, feel your radiator after being plugged in overnight, it will be warm. The oil is also warmed from heat transfer though the warm engine block and oil cooler. I poked around taking temps with a infrared temp gun on a 0°F day after the truck had been plugged in overnight, what I got was-- upper radiator hose 120°, top of valve cover 80°, injection pump 72°, bottom of oil pan 40° and center of steering wheel 20°. My block heater will even keep the windshield snow free till the temp dips below 25°.