The Adaptive Ranging solution they come up with is how the algorithm filters out environmental factors in RSSI.  The beacons themselves will transmit their own advertisement packets for their neighbors.  Based on the known distance of each beacon from its neighbor, the RSSI is analyzed and the parameters of the distance function they use are adjusted to account for variations in the received distance and actual distance of the neighbors.  Without knowing the environment at all, it can understand that there are factors that alter the way the RSSI signal is being received at that particular beacon.