The planetary gear is actually a differential. The Prius has a motor-generator on 2 of the shafts, and the engine on the third. The second MG is on the output shaft to the wheels.
To start the engine MG2 is locked (more accurately maintains zero speed), so MG1 drives the engine , acting as a starter.
To move off MG2 provides forward torque, and the engine speed is matched to the road speed by varying the speed of MG1. The engine speed is set by the demand power, as it tries to keep to a specific rpm for a given demand power. Therefore electrical power is transferred between the two MGs as necessary in order to provide this speed and torque matching.
Incidentally so far as I know this rather cunning use of a diff as a CVT, with two MGs, was originally proposed in the 70s by a couple of American researchers.
Cheers
Greg Locock
I rarely exceed 1.79 x 10^12 furlongs per fortnight