I'm not into heavy bdsm, but occasionally enjoy light domination and restraint.  The appeal, as far as I'm concerned, is twofold:  on the physical level, it's a matter of sensuality.  Imagine yourself blindfolded and tied spread-eagled on a bed while your lover licks you all over...you're helpless and she's got complete control over your body.  In the darkness you can imagine all kinds of things.  Particularly with restraints, the opportunity to tease and enhance the level of desire and pleasure is perhaps greater than with conventional sex.  
The second aspect is the psychological:  In any physically intimate encounter, much or most of the excitement comes from the mutual letting down of defenses and exposure of vulnerabilities, followed by the acceptance of those vulnerabilities by the partner.  In a bdsm setting, that aspect of intimacy is dramatized and heightened.  If my partner ties me up, I'm helpless:  I'm her slave.  I have to trust her.  As she gradually teases and pleases me, my trust in her is rewarded.

Now, I can also tell you that a little pain is just part of the same formula.  Once you get into heavy pain, potty stuff, etc....well, you'll have to ask someone else.

They have some very good reading material about S&M and I think that "The Story of O" and a few other books would surely answer many of those questions.