Selecting manual '1' engages the rear band, which holds the low/reverse drum stationary. When in 'D' 1st gear, the low/reverse drum is held stationary by the overrunning clutch. This is a roller-type clutch that will only allow rotation in one direction (think of the rear sprocket on a 10-spd bicycle - with the wheel stationary, the sprocket can only turn counter-clockwise - it's prevented from turning clockwise).
The band can hold more torque than the overrunning clutch, so when pulling a very heavy load, it's advisable to start out in manual '1', then shift into 'D' at an appropriate speed (no point in going to manual '2' if accelerating - no difference between that and 'D').
Deceleration/engine braking is another reason for manual downshifting. First, the 48RE will lock the torque converter in manual '2', which is good for engine braking. More importantly, manual '1' will still provide some engine braking, because the rear band is holding the low/reverse drum. The overrunning clutch won't hold it during braking, because the drum will want to turn the opposite way. Thinking back to the 10-speed bike, what happens when you try and pedal backwards? The same will happen in the transmission: freewheeling. So, while the torque converter will be unlocked in first, you'll still get some engine braking in manual '1'.
As to the clutches used, first gear always uses the rear clutch pack, and only the rear clutch pack. The front clutch pack is applied only in 3rd, 4th, and reverse.
-Tom