An important change to the Direct3D DDI, introduced in DirectX 7.0, is that textures are blitted by embedding a token in the D3dDrawPrimitives2 command stream. This token is D3DDP2OP_TEXBLT, and it signals the driver that a texture has to be transferred from a backing surface into local or nonlocal video memory.
Also, instead of the driver being responsible for creating internal handles for textures through the legacy D3dTextureCreate and D3dTextureDestroy callbacks, the runtime now assigns a handle number to each DirectDrawSurface object that is created within the Direct3D context. The driver is signaled about this handle number through the D3dCreateSurfaceEx callback.
D3dCreateSurfaceEx is called after every hardware abstraction layer (HAL) DdCreateSurface call is finished. D3dCreateSurfaceEx is also called after every internal hardware emulation layer (HEL) CreateSurface call is finished. The HEL call usually occurs when a backing DirectDrawSurface object is created. These calls may occur before and after a Direct3D context is created with D3dContextCreate.
Also, when the application is running, a call is made to D3dDestroyDDLocal to clean up and destroy any driver data created explicitly for these surfaces. This call is also made before a Direct3D context is created. This is done to ensure that there are no dirty handles associated with any contexts that have not been cleaned up. This is simply a preventative measure that should not actually destroy anything if contexts are properly cleaned up after use.