Magento XML using before/after to place blocks hardly ever works

The before and after attributes only work in one of two cases:

1. When you insert into a core/text_list block
2. When your template block calls getChildHtml without any parameters

When you say

<reference name="root">
   <block type="core/template" name="example_block" before="content" template="page/html/example-block.phtml"/>
</reference>

you're telling Magento

Hey Magento, put the example_block inside the root block.

When you put a number of different blocks inside a parent, those blocks have an implicit order. For template blocks, this order doesn't matter, since those blocks are being explicitly rendered.

<?php echo $this->getChildHtml('example_block') ?>

However, there's two cases where order matters. First, if you call

<?php echo $this->getChildHtml() ?>

from a template, then Magento will render all the child blocks, in order.

Secondly, there's a special type of block called a "text list" (core/text_list/Mage_Core_Block_Text_List). These blocks render all their children automatically, again in order. The content block is an example of this

<block type="core/text_list" name="content"/>

That's why you can insert blocks into content and they render automatically.

So, in your example above, you're inserting blocks into the root block. The root block is a template block whose phtml template uses getChildHtml calls with explicit parameters. Therefore the before and after attributes don't do what you (and many others, including me) wish they did.