How Shopping campaigns and Shopping ads work:
The difference between google ads and google shopping ads is, google ads use key word searches to locate products/results and google shopping ads uses the product data to locate the item.
Product Data -- Not Keywords
Where your Shopping ads appear:
In the actual Google Shopping panel (select countries)
Google Search, next to search results and separate from text ads
Google Search Partner websites - Youtube etc...
Just like other AdWords Shopping ads use (CPC):
The user clicks an ad & goes to landing page, or the user clicks an ad that leads to the Google-hosted landing page for your local inventory.