How did the long loop of tape in a magnetic cockpit voice recorder work?
Most looped tape mechanisms are a variation of this: 



(this is an 8-track audio cassette)

The tape is pulled from the center of the spool, and fed back to the outside of the spool. 

Some CVRs use two spools and autoreverse instead. 

On the right, an example of a flight data recorder. (on the left, the digital storage of a modern FDR).