This demo produces new words based on statistics gathered from dictionary words. Sometimes they're just trivially extended with suffix/prefix, which is unusual to this word, more often result is a portmanteau word.
For each n-length cluster of letters those appeared in words there is created distibution of next letter probabilitiy.
Setting this window too low (2-3 letters) will produce mostly nonsense, short or very long words, setting it too high will cause that all generated words will be ones from dictionary and no new word appear.