Here's how I think it works in general.
1. You're fat. You go low carb per se. You lose water weight because liver and muscle glycogen is being depleted. This is very motivational; or, rewarding, even "palatable." So you continue on. By virtue of blanket LC, you're excluding highly rewarding and palatable fast food, pizza, pasta, ice cream, sugar drinks, Hot Pockets, and all the other crap in favor of meat, veggies, nuts, cheese, and maybe some LC junk food if that's your thang. Yea, it's great to eat red meat again, and while some can pack away 16oz ribeye steaks one after the other, most can't. They're satisfied, and satisfied sooner, with less caloric intake, more often. It subtracts down. They lose weight. Was LC effective? Yes. Why? Food reward/palatability. And because calories count.
2. The problem is that while a few get all the way to ripped leanness this way, huge numbers don't (including me), and that's why LC and LC/Paleo have not only to recruit the new and uniformed (do keep it going, Jimmy & Co.), but have growing numbers amongst adherents who range from slightly disillusioned to royally pissed off...because they can't get rid of that last 10-20 pounds...or more, in some cases.
3. In various degrees of frustration and despair, you console yourself with the various cheats—from foods you love and have missed—that got you fat before. But you're smarter this time around, see? You don't toss the baby out with the bathwater. Rather, you "cover" or redeem your indiscretions at the drive through and freezer section with bouts of zero to very low carb over days, and manage to eek out some sort of a homeostasis—maintaining your moderately overweight composition. Or, in many cases, LC as you practice it ceases to be effective in shedding any more fat—even without drive through, freezer section, or Jamba Juice excursions.
4. This is not necessarily an altogether bad thing. Better than really fat or obese.
So how do we take the next step, beyond the huge value LC had been to get off that initial 40, 50, 60, 80, 160, 320 pounds (60 in my case)? We recognize that it wasn't really any magic about LC that got us there. LC simply, effectively, lowered our food reward/palatability and as a consequence, we spontaneously lowered our average daily intake of calories.