My take:
N is about pattern recognition, information organization, and system building. It has the ability to deconstruct data and then draw connections to other data based upon the traits (objective or subjective) that are revealed upon deconstruction. So, a banana will, in a way, be linked to every yellow thing I have stored in my memory. It will also be linked to every kind of fruit. Anything, er ... phallic ...

Anything sweet-tasting. Etc. Etc.
Mind you this is just a simple example, as these connections are made unconsciously and are much more far-reaching in their scope. So, the concept of a banana is probably connected to many, many other concepts that I would never
consciously associate them with. I tend to call my intuition "The Map," because it is essentially a map of every experience I've ever had in my life.
So, at a given time I can be sensing or I can be intuiting (as we all can). Since I have a really strong N, though, I tend to be intuiting much more frequently and with better accuracy than a sensor would. And since my sensing function isn't very strong, I will generally miss more details about my environment than a sensor would, I don't have as direct a connection with the concrete world around me. However, my intuition can take that relatively incomplete data, draw connections between all the gathered information, and form a "whole picture" for the situation, many times accurate ... sometimes not so much.
I could see how a sensor would see an N in the middle of intuiting and think they're just spacing out. There is a certain disconnect from the material world, it's true. I have the ability to run on "auto-pilot" really, REALLY well while intuiting. For example, I can prepare my entire breakfast -- 2 eggs, sunny-side up, toast, bacon, maybe some cereal -- completely on auto-pilot, while also intuiting about whatever subject, and my breakfast will almost always turn out near-perfect regardless.
"Auto-pilot," though, is only useful in certain learned situations, and can actually be very bad in others.