The commands in the Extract Menu deal with the electrical/physical association defined for a cell, i.e., the electrical schematic and the physical layout.
It is not always necessary to enter the schematic by hand. A schematic can be produced from a SPICE file, or from the physical layout. The resulting schematic is perhaps not too useful from a human-readability standpoint, but is valid nonetheless. The user of course has the option to rearrange things and make other changes to promote readability and aesthetics.
There are provisions to update the schematic from the physical layout, either globally or per-device. It is possible to dump a netlist file or SPICE file created directly from the physical layout.
There is provision for LVS (layout vs. schematic) analysis.
The parameters that control extraction, and device definitions for extraction, generally appear in the technology file. These can be created or modified from within Xic through the technology parameter editor window.