Wood rot is caused by any of a variety of fungi. In order to flourish, all these fungi require moisture (although very little some), oxygen, food (the cellulose and lignin in wood fibers), and proper temperature (most any climate in the USA, and Canada are conducive to rot fungi existence, including the deserts and most Northern regions). These organisms depend on the moisture in (or the condensation on) the wood to sustain them. On the other hand there is at least one type of building fungus that wets the wood itself from ground moisture through a long strand called a rizomorph. .
Sometimes, and only when the environmental conditions are right, the fungi multiply rapidly and produce spores. Generally, the fungi reproduce and move along the easiest routes, which is usually with the wood grain. This is why the rot is usually most extensive in the same dimension as the grain. Should the wood dry out completely (which in most cases is an unlikely scenario) the fungi will die out, yet they leave behind their reproductive spores for later regeneration. Whenever the conditions within the wood become again appropriate, the spores reproduce and the rotting action continues. .
This resurgence process may be relevant if the instead of removing and encapsulating the whole wood member, even if only slightly affected, the restoration process is limited in nature. In such a case, only the rotted zone is dealt with, either by localized removal and replacement with healthy wood or by filling with any of a number of epoxy resins, polyesters, etc. This may mean that even though the apparent wood has been dealt with, the rotting may restart from either undetected portions of rot or from spores. It is entirely possible that both the rot fungus in question and the accompanying spores exist for 12", or more, beyond the visible edges of the rotted zone. Any restoration process applied to the wood, other than total replacement, should therefore encapsulate the potential fungi and spores remaining the outlying areas.
In some cases I would rather avoid working with epoxy resins altogether. They usually have strong odors and there are many known hazards associated with breathing fumes from most of the solvents. Epoxies can be highly irritant to the skin as well, so proper ventilation, masks and gloves are a must. Even with these protectors, epoxies are better left to experienced tradespeople. Alternatives to epoxy compounds do exist. Acrylic resin sealers for example are popular in some circles (mostly with wooden boat restorers). Although many may harden the wood surface, generally they do not restore substantial strength for structural elements and might be chemically unstable during long-term exposure to UV radiation and to moisture.
Of course, there is something to be said in favor of surface sealers. Consider a wooden structure such as a deck or a plank-on-frame boat. Hopefully it is protected with a semi-permeable coating while it goes through wet and dry cycles. These cycles disrupt fungal activity, while the coating disrupts the normal wet-dry cycle by (hopefully) acting as barrier to water loss from the wood.
The added condition is that once an epoxy coat is used, the wood is protected from further exposure to water. This means that for wooden boats the use of epoxy products below the waterline is generally a bad idea, although most of the rot wooden boats is in wood that is usually above the waterline. Which brings us back to alternating cycles commonly found in house decks or boat superstructures: the said coats cannot be long-term effective if they are exposed to all weather conditions.
Summary
We often see softwoods used in contemporary construction showing extensive decaying after only a few short years of usage. I have seen myself complete failuress in as little as 24 months of usage. The scary part is that, although much less frequently, major damage can happen rapidly even in the case of treated lumber.
At the other end of the spectrum, I saw wooden objects found during archeological digs that are literally hundred of years old and yet perfectly preserved. In Europe at least, I have also seen wood trusses used to support roofs that were in great shape after a few hundred years of service.
Wood decaying can be temporarily or permanently prevented (or at least controlled) only by understanding the nature of the fungi attacking the wood and the environmental conditions necessary for their growth. Only then it may be possible to either totally change (or perhaps only slightly modify) the wood's service conditions or treat it in order to prevent the start of fungal growth.
In the begining: the subject of wood decay in the Bible
Wood decay is by no means a new problem. It is referred to in the Old Testament. Noah by the way is not only the first known design detailer (as you may recall, God was the chief design engineer) and builder of floating homes; he was also a successful wood treater and waterproofer. As described in Genesis 6:14-16, his Ark was constructed of "gopher wood" (probably cypress) elements bound together. The joints had standard backing rods made of reeds, and were sealed with bitumen, of which natural deposits were found throughout the Middle East. The whole envelope had a bitumen coating: not exactly beautiful, yet highly effective even by today's standards. Another Biblical example of highly effective construction and waterproofing is the Ark of Moses (Ex. 2:3-6): the body was made of reeds, plastered with slime (probably a mud of some sort) inside, and sealed with bitumen on the outside of the box, so that the odor would not be offensive to the baby. Unfortunately we do not know the name of the designer and builder.
Sometimes, when incipient decay is neglected or goes unnoticed, almost complete destruction may occur in only a few years. On the other hand, even for the expert it is usually difficult (if not impossible) to detect incipient rot and perform successfully any limited-scale repair of such damage. Often enough, the only solution may be the complete replacement of the building element involved.
"Rot" or "rotting" is not simply the presence of fungi, but rather the damage or disintegration (and ultimately dissolution) of the wood substance as the result of the presence (and growth) of fungi within the wood tissue. Wood does not decay simply because it is wet or ill maintained! The process may happen only if the wood has been attacked by certain fungi under some very specific environmental conditions of oxygen, temperature and moisture. As far as decay prevention is concerned, generally it is necessary to identify the attack, know the nature of the particular fungi, and the conditions necessary for their survival. Only then it may be possible to modify the wood's service conditions or perhaps treat the wood to prevent the development of fungal growth.
Fungicides are generally toxic substances, used either as a preventive against the growth of or to kill fungi that already infested the wood mass. Historically, the first effective fungicide was developed in 1882; it was made of slaked lime and copper sulfate, which is still one of the most effective means of controlling fungi.
Resources
http://www.constructiondefects.com/3aml.woodrot.html Law Offices of Thomas E. Miller: wood rot.
http://www.constructiondefects.com/2ml.condef.html Law Offices of Thomas E. Miller: construction defects
http://www.rotdoctor.com/zine/RBmain.html RottenBoat 'Zine
http://www.rotdoctor.com/ Wood Treatment and Preservation Products
http://www.kvf.se/elforsk/distribu/el-nose.html detection oft rot in wood
http://www.esf.edu/course/jworrall/decays.htm & http://www.esf.edu/course/jworrall/decay.htm Forest Pathology: Decays
http://www.metla.fi/conf/iufro95abs/d5pos15.htm Biological Improvement of Wood
http://www.sensoft.on.ca/strucdta.htm Properties data In this case a pulseEKKO 1000 GPR system with 1200 MHz antenna was used to map a hydr
http://encarta.msn.com/index/concise/0vol25/0469f000.asp Encarta
http://www.bio.flinders.edu.au/mycol.htm MYCOLOGY, FUNGI, SMUT, WOOD ROT
http://weber.u.washington.edu/~melliott/rootrot.html Bremerton root rot workshop