Welcome to the Apple Support Communities
Time Machine makes a full backup the first time you connect the Time Machine disk, and it makes acumulative hourly backups. Then, it deletes the hourly backups and Time Machine saves a backup per day. http://support.apple.com/kb/HT1427
Yes, that's what it says on Time Machine preferences, and the Apple support document isn't very helpful when it comes to trying to understand what's going on.
Why is it backing up 100GB at a time? Once a month isn't very often for a backup and it's likely that during this time you've updated some large fileset, maybe a photo library, music, etc. I'm using hourly backups and these are often several GB. But because the Time Capsule is on the network I often don't notice the backup happening even when I'm working on the system.
I just tried this. I backed up, then went into iTunes and deleted just one song (from a 30,000-song library), then backed up again. The backup was 14MB which was probably the iTunes index file. Then I went into one of my iPhoto libraries, deleted one photo and backed up again and this time the backup was much smaller, just 500MB. Also I find that sometimes it says it is going to back up so much data, then actually backs up less.
Only files that have changed are backed up, and hard links are made to other files, so each backup session appears to the user as if it is a full backup rather than an incremental backup.
The wikipedia entry gives a better explanation of how Time Machine works that Apple's site (LOL), see http://en.wikipedia.org/wiki/Time_Machine_(Mac_OS)