What would differentiate the 9 point AF system of say the 5D2 from that of the 500D's 9 point AF system? Would software of the superior 5D2 provide an advantage to its AF system?
Another question I have is, what happens when a subject is between AF points? If I'm tracking a bird in flight and for whatever reason, the bird ends up in a space between the camera's AF points, does this mean the bird is essentially in a blind spot and focus on the bird will be lost?
If I am making the correct assumption in the above paragraph, is this why action and wild life togs want as many AF as possible?
So another assumption from me is that the AF points are created through software. But are there electrical components that will prevent Canon from improving the AF system at a later stage with more AF points?
Software + Processor + Lens = AF System or not?
In no way would I consider myself an expert, however, I will share a little of what I know to start answering your questions. First, I am going to assume that we are limiting ourselves to phase detection, and not contrast, or hybrid systems. Phase detection autofocus systems, have dedicated sensors usually located in the mirror box below the mirror, and use a special mirror that reflects some of the light down to the auto-focus sensor. So the focus points represent actual physical sensors in the camera, and are not created by software analysis of the image. (That is how Contrast focus systems work though, which is what cameras use in Live View, when the mirror is locked up, not part of this discussion)
The first and IMO biggest difference is going to be speed. The phase detection auto-focus system requires the mirror to be down in order to work, so on the 1Dx, with its 10-12 FPS is going to be focusing on a scene that has changed half as much as the 6 FPS that the 5DmIII sees. The 5DmIII is going to be blind for longer, and have to make bigger changes between shots, that the 1Dx.
A phase detection auto-focus system can provide distance information, which the camera can use to estimate where the subject is going to be. So if on the first shot the subject is located 16 meters away, and on the next shot it is located 1776 cm away, the camera can assume that the subject is moving away from you, and estimate that the next shot will be located around 19 meters. The algorithms that the camera uses to guess where the subject is going to be can be very complicated, and I am willing to bet that the 1Dx is has a more refined software for auto-focus than the 5DmIII.
If the subject is smaller that the spacing between AF points, then when the subject is between points the camera is blind, again software can guess where the subject is going and try to keep focus moving in the right direction until the target is picked up again. Obviously the best, would be to have multiple focus points on the subject, so that as it moves around the frame, the focus tracking is never lost, so cameras dedicated to sports and wildlife tend to have much higher number of auto-focus points.
The next thing to consider is the lens and how the lens reacts with the camera body. I am sure you know that different lenses focus at different speeds so if you are comparing your 55-250 kit lens to a 70-200 2.8, then the 70-200 will return a lot more in focus shots because it can focus faster on any camera body.
However, I do remember reading the the EOS-1 series cameras operate at a higher voltage than the rest of the Canon camera line. This is so it can put more power into the focusing of the lens, so that the same lens will focus faster on a 1-series camera compared to say a 6D.
So I guess to answer you question, the AF system involves a lot more than just the number of focus points. It is the software, computer hardware, lens, and sensor all combined.
I hope that helps a little, and if I said anything wrong, I am sure the forum will get fired up to try and correct me.