The Nether is a hellish trans-dimensional realm ruled by Mer, who is known as the god of sin.
If anyone ever tried to map this realm they would find it a task worthy of the insane. However, the prophets have allowed some images to seep in. For example, some parts of the realm are so cold that ones eyes will freeze over, other parts so hot that ones skin shall begin to bake. Mer grants those whose spirits fall into his domain a new body, only so they may feel the pain he wroughts upon them. A body he may renew, again, and again, for all eternity.
Like the Rending, and Aether (Heaven); the Nether has it's own 'esssence'. It was the use of this essence that granted the Elder Vampires some of their darker powers; dominance, and a devilish form. Mer himself is either a conduit, or the source of this essence. Mer manipulates this Nether Energy to alter physical characteristics of both himself, and those under him. Either as forfillment to a pact, or as punishment. Tiste who have entered dealings with him, and humans who did so in life are typical targets of such manipulation. Humans usually becoming deformed minions, while Tiste are often changed into something more dragonic, or other wise devilish in form.