Cancellation works by transmitting a copy of the incoming radar signal half a wavelength out of phase with the original. With DRFM and very fast processors, it has become more achievable. Done correctly, the two waves cancel each other out and there are no emissions to detect. This is the same principle used in noise-cancelling headphones.
Its not simple to do, but in principle could provide a black box "cloaking device".
This is technically not correct. For example, if I have a radio that is tuned to receive on 50Mhz and I have 6 devices in the room transmitting at 50 Mhz at the same time they are supposedly "jamming" each other and the radio cannot discern their transmissions. However, these radio waves are not actually canceling each other out, the waveforms all co-exist without interfering with each other at all. The radio just isn't intelligent enough to receive and separate all of their signals at the same time.
Likewise it is the same for radar waves.
What is really happening there is that the receiver is just getting jammed by the inversely phased radiation, while the waves and particles themselves continue on unmolested.