How is it that cuttings rot when over watered yet people root completely in water?

First off, cuttings can and do rot in water. Water holds much less oxygen than air does, and the warmer the water is the less oxygen it will hold. So hydroponic systems use bubblers and other methods to keep oxygen levels up or the roots will suffocate.

It is the same problem with overwatering, all of the oxygen in the water is used quickly and unless air can get into the mix after it drains the roots will suffocate and rot. 

So how do you introduce air into soul that's too wet

Let it dry out more between waterings. Some changes that would make it dry out faster are increasing the temperature and air movement, but you need to be careful because that can also dry the tops out. The best way is to use a well aerated mix from the start and then it is harder to overwater. As the plant get bigger and has more leaves and roots it will dry up the extra water in a heavy mix by itself, it is when they are young that they are vulnerable because they are not using much water.

I think I remember somebody making air channels down the sides of containers with a chopstick or something but can't find it... If you have them in clear cups and can see where the roots are to avoid them you could push a pen or chopsick down to the bottom along the inside edge of the container in a few places to actually help air get down there. 

Good stuff thank you. They are in clear cups and I can clearly see the roots also it is an extremely light soil mix. I don't see very much condensation on the inside of the cups in the top level is pretty dry. My concern was just that the color of the roots is changing slightly but I was extremely careful not to overwater I just damp and the mix ahead of time and that's it

It can be done but I don't know how exactly. Many years ago my father never rooted his cuttings in mix. Only water. He may have had some other secret ingredient but I don't know what it may have been. I know he never used rooting hormone. I tried myself this year. I took 3 CH cuttings and left them in water. Three months later they were very much alive with no rot and nice leaves....but not a root to be seen. A few weeks ago I took these three cuttings and put them in mix. Today they all have nice roots and are doing fine. No explaination.

I did find this video:

I did some testing over the summer using 2 gallon buckets filled with water and used a cheap aquarium air pump with two small stones to add oxygen to the water.  The 2 gallon bucket was put inside a 5 gallon bucket and then the 5 gallon bucket was put in a bag that could be used to regulate the humidity.  I found this to be a viable method for rooting fresh green fig cuttings.  The leaves were removed but the stems were left to fall off by themselves.  I did water changes once a week and I had a very high success rate with no rot issues.  The buckets were kept outside under our patio in the shade.  The outdoor temps ranged from lows of the 60s to highs of a 100+ but most of the time water in the bucket was measuring in the 75 to 80 degree range.

I used the same method attempt to root other fig cuttings that I received in the summer that were obviously taken in winter or early spring before they started to push buds and had been refrigerated.  The cuttings were all washed in a 10% bleach solution and allowed to dry.  I had very little success using the same method used for the green cuttings.  The older cuttings seemed to develop a scum around the entire submerged part of the cutting.  I washed the cuttings again and did frequent water changes but the scum kept coming back.  I ended up removing the cuttings from the bucket after a few weeks before roots had developed, cleaned the scum off and put them in pots with bags over them to keep the humidity up.  I got some to root and leaf out but a lot of them never made it.

Just to confirm the first batch of green cuttings was not a fluke, I got another group of green cuttings from the same tree and ran the same process again.  I got the same high success rate again with the green cuttings and no scum developed.  Some more testing is warranted along with a better control of water temps but I will probably not use this method on any cuttings of an unknown age or method of storage due to the rot and scum forming issues. 

Steve, thanks for the report. I was wondering about this meathod too and was curious if green or brown wood would be applicable. I had my doubts about the dormant cuttings, which you discovered, but still thought it could be used on green tissue. Glad to have some verification.

The attempt I noted above was using green first year growth. I changed the water daily but clearly that wasn't enough. Aeration would seem to make a big difference.