With the pump on, I'll explain how it works, I can only do the rest of the tests when my rad actually comes in the mail.
Here's how it works though. The pump is running. When you pour water into the res,it will progress to the lowest possible point, and will then be forced to the other side of the pump, making, for quite some time, the pump the lowest possible point, the water level rising on the -other- side of the pump. However, eventually the water level will reach the top of the loop and actually start to circulate. However again, the tubing will only be "full" of water on the upward side of the loop from the pump, there still being a bit of room on the downward side of the loop for water to be added, therefore, as you keep pouring, it keeps filling this extra area, and the pump is able to move more and more water over the top of the loop, and more and more of the downward side of the loop is now being filled with moving liquid. The res doesn't overflow, because water preferrs to move down, and even if the top of the res is in the middle of the loop, as long as there is a uniform amount of water, and it is being uniformly circulated, it will still always attempt to move down. Wow, that was a terrible explination, when my rad comes I'm taking pictures once and for all -.-
However I do have doubts for what will happen when the pump turns off. If your res/line is capped, I think you'll be safe (assuming the cap is airtight) but if you just have a loose line, I do think your loop would overflow. The key to what I'm saying is that the pump needs to be on. (Or you need to have an airtight seal.)