G-Sync is absolutely about changing the refresh rate of a monitor; without G-Sync or Freesync an LCD monitor's refresh rate is fixed; it does not fluctuate with the frame rate of the input.
That's what causes the tearing; the PC is throwing new images at the monitor faster than it can update them and the screen often displays images from two different frames on different sections of the screen (vsync being off)
vsync being on means the video card will give frames to the monitor at the exact fixed refresh rate of the monitor. Which is smooth but limited to the refresh rate of the monitor (and of course assumes the PC can even run the game at that speed), but can have some lag and introduces stuttering as the GPU holds onto a frame until the monitor is ready to show it.
G-Sync and Freesync allow the monitor to vary its refresh rate to match what the GPU is putting out so it eliminates both tearing and lag and stuttering (as long as the GPU is putting out whatever the monitor is capable of, I don't think monitors can go below 30Hz or of course above their max of 144Hz or whatever)
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