A curious web follower writes:

Legend has it that (Granny) Smith threw out cores and peels from some Tasmanian crabapples she'd used to make a pie. Since she and her husband were orchardists who grew apples themselves, surely there were domestic apple remnants in the compost pile as well.

Would a crabapple seed and a domestic apple seed both have sprouted into seedlings, then cross-pollinated? Does cross-pollinating have any effect on either variety's fruit, i.e. flavor, color, texture? Does cross-pollinating ever result in new cultivars?

Certainly there was no grafting involved, as Smith's seedling is said to have sprung up on its own, "accidentally."

I'm just wondering how this could have happened, technically.

Well, it's true that the parentage of the apple variety ("cultivar" to use a little grower speak) is credited to a chance seedling originating in Maria Smith's backyard in Austrailia.  Before going on, the unlikelihood of this occurring cannot be understated - most seedling apple varieties are weird and unpalatable.  The fact that such an apple did arise from such unlikely circumstances is truly remarkable.  With that out of the way, let's wade through some somewhat fantastic exaggeration and figure out how varieties come from seed.

First things first, one cannot get a 'Granny Smith' tree from a 'Granny Smith' seed... or you're almost as likely to get that variety as any other.  You would need to take a cutting of budwood from a 'Granny Smith' tree, as explained in "Ask a Grower, vol I".  New varieties are mostly commonly derived from chance mutations ("tree sports" or "limb sports") or clever plant breeders, just to underscore the unlikelihood of valuable varieties coming from seed.

When an apple tree blooms, that blossom needs the pollen of at least one other compatible apple variety to fertilize the bloom and make a fruit.  If you're planning an apple orchard, you must plan accordingly since apples are not self-fruitful.  All of the different kinds of pollen on that bloom are combined inside the seeds when that fruit is made.  How that pollen "jives" at fruit formation and what the resultant apple cultivar that seed might produce is a big crapshoot. 

So if Granny Smith pitched Tazmanian apple cores into her Australian compost heap, that doesn't necessarily have anything to do with the apple we all enjoy today.  The different varieties in the culls (to use another grower turn) is going to have little to do with tree that sprouts from the pile, aside from the seed had to have come from one of them. 

So it's not rare that new apple varieties should come from seeds, though growing apple trees from seeds is often tricky.  What is rare that an apple variety derived from a wild seed source be worth a darn, and 'Granny Smith' is!