Various microbreweries make chocolate stout that does indeed, to varying degrees, taste of chocolate. Does it really contain chocolate, and how is chocolate used in the brewing process?
It depends on the brew really; some do and others do not. More often than not, the chocolate flavor comes from the techniques used to roast the malts rather than chocolate itself. Some brewers will add additional chocolate to enhance the chocolate flavor a bit, but it generally doesn't get its flavor primarily from the chocolate. The same is true for coffee stouts.
As a side note, I've recently tried a smoked imperial IPA (Runaway Smoked Ferry Imperial IPA) from the Port Jeff Brewing Company, a local microbrewery. I swear to God, it tasted like bacon! But there was not an ounce of bacon in it as confirmed by the brewmaster.
Yes. Typically chocolate stout does contain chocolate. I've typically added chocolate to my home-brew during the boil phase (since it adds more sugars and I want the chocolate to melt).
That very much depends on the brewery. Some use cocoa nibs to add the chocolate flavor, but often they use what are called "chocolate malt", grain that is roasted until it's the color of chocolate. These happen to add a fair amount of chocolate and coffee characteristics to the final product.