We had an all in one washer dryer for about a year, DW hated the fact that shirts and pants had to be hung damp to prevent wrinkles. Ours was an LG model and we loved the wash cycles because it matched our front loaders at home but, we hated the drying portion. The drying portion like was said picks up the moisture from the clothes by injecting hot air into the tub and then it pumps the moisture up and out the drain hose.
Now, we liked the washer portion so much we kept it and mounted a separate vented Splendide dryer on top. Now we have the best of both worlds, we can wash/dry items that we don't care about wrinkles in the washer/dryer combo and dry items that are wrinkle prone in the dryer. Don't get me wrong, with practice and a bit of a learning curve the combo unit works well, we just didn't care to have clothes hanging everywhere drying. Now, if the combo unit is a vented style, I would think that would be the way to go.