My mental image of awk has always been something along these lines:

    for line in readfile()
        for block in script:
            if block.match(line)
                run_block(block)
            end
        endfor
    endfor

Where the "for line in readfile()" is the "implicit loop", and the blocks are the "condition { .. }" blocks.

The actual flow is a little bit more complex and has some exceptions e.g. (BEGIN/END), but this is about the gist of it.