Many coaches know most of the coaches around them. In addition to playing each other, they work camps together, etc, some times. If you watch the college coaches in a region for a few years, you will see that it is a career with a career ladder just like any other. They change jobs every few yrs, trying to increase responsibility and salary, and work your way up. A coach that is a D1 coach may have coached at several other schools at d2, jc level in the past, and knew all the coaches around him then. Those coaches are D1 coaches also now. Its really a small world.
Some will help players find other teams.
Some good programs will encourage good player they come across to walk on to their team, whether they can use them or not . Just to keep them from playing against them. After a year or two of sitting bench, its likely that player will quit, and probably wont be picked up by a school nearby then.
Schools dont just play conference, in softball you play a lot of the schools very close to you due to lack of travel funding. If there are 6 D1 schools in a 100 mile radius, the biggest baddest might not need another stud player, but chances are they dont want the other weaker 5 to have her either, because they have to play them too. Maybe 1/3 of their games are local.