It will export meshes and other data from maya files, process vertex data, compile shaders, pack archives and do anything else that's necessary to generate efficient, runtime-ready data that can be loaded on the target platform. In our content system materials will define which permutations they can have, and will also specify which shader code to use.
Thanks for the info. I'll have to see if I can get time scheduled in to make a more sophisticated system. Does your build system also take into consideration different render pass settings and global settings? For example, one might want to use a simpler shader for a reflection pass. Also global settings the user sets could affect which shader permutation (e.g., shadows on/off).
Are you using VS2012? If so, then you don't need to create a custom build step as there is integrated support for compiling HLSL files. Unfortunately there is a limit of one build rule for each HLSL file, so you have to play games with adding an empty HLSL file and just include the original target file to be able to specify multiple build targets from a single file.
Still on VS2010, but I've played with VS2012 for metro apps, and yeah, the one build rule is kind of annoying.