The technique creates a field out to around 3" from your body; anything completely inside that zone stays inside that zone until you emerge from the ground. If anything substantial is crossing the border of that zone when you use the technique then you will not be able to enter the ground until you drop the thing or pull it into the inclusion zone.
The zone infuses earthen materials (dirt, sand, stone) around you with Doton chakra that causes the infused material to act as a fluid, and propelling you in the direction of your choice. It works on real MEW and other stone structures, but not on chakra constructs and not on metal. You do not leave a hole behind.
You cannot grab or release anything while submerged due to the zone.
The technique has a certain amount of flexibility and is able to allow you to enter areas of ground lightly obstructed by e.g. plant matter, and to move through areas that have plant matter and even small, low-chakra animals (e.g. worms, but not chakra voles.) It will not allow you to move through wooden planks or dense layers of roots. It's more lenient about letting you enter the ground than about letting you move through it - you don't know why and neither does anyone else. The restrictions seem arbitrary and occasionally inconsistent. It's extremely frustrating to someone of Hazō's well-ordered scientific mind.