I think it is simply using a dictionary. It doesn't seem to allow proper names unless they are also used as the name of something like 'hoover'. I think it must be a published paper dictionary, because words invented in the last couple of years are not accepted: I noticed that it won't accept 'selfie' for example.
Tiles with crowns superimposed add one to the number of letters counted. So if you make a 4 letter word in which one of the tiles has a little red crown on, it counts as a five letter word. I think some line blasters may do as well, but I can't figure it out. Letters with vines on don't count towards the total. Therefore a…