The treatment of the Source in this finale is no different. Generally speaking, some ancient people managed to create a device which channeled the geothermal energies under the island into an intense electromagnetic/temporal anomaly, including the ever-important water from the island as a coolant. The device that created/maintained the Source was the metaphorical cork that held back the darkness that could destroy the world. There is no reason to think this simple chamber was the full extent of the device.
In more definitive terms, its fairly clear from this episode that removing the cork would sink the island. But it might also unleash the geothermal energy, perhaps in the form of a supervolcanic eruption. That would result in a worldwide darkness that would, if powerful enough, kill all life on Earth.
Now, one could quibble about how an island that can move through space and time could still be connected to a specific geothermal source. And of course its hard to reconcile, rationally, how the Source would then imbue an individual with supernatural powers or, in essence, turn a human being into a non-corporeal being of black smoke. This is because those elements dont really need to be explained on that level for the purposes of the story.
If anything, the writers harken back to the mystery of the Swan Station, both visually and thematically. The Swan Station, according to the Dharma Initiative orientation film, was built to contain a dangerous pocket of electromagnetic energy that, if unleashed in an uncontrolled manner, would destroy the world. As the characters themselves note, nearly everything about the Source is metaphorically identical. Just as the Swan Station and its unusual properties were never fully explained, the Source is only treated insofar as it has meaning to the needs of the characters.
The resolution to the overall series arc is relatively simple. Whether or not Jack actually reasoned out the best way to resolve the conflict is a matter of debate. It certainly seems as though Jack was just feeling things out as he went. But in essence, the island was healed using the age-old notion of stopping the heart, temporarily killing the patient, and then starting the heart back up again.
While Jacob and Jack both derived power from the Source, its fairly clear that Adam/MiB did so as well. The clue to the solution of Adams power was revealed as soon as Richard began to age again. Once the connection to the Source is severed, mortality resumes. Once the Source was extinguished, Adam became mortal in the form of John Locke.