Answer by George Hagstrom:
Note: This answer is fueled by lots of caffeine.
I also think the best way to give an answer to this question would be to draw some sort of network that represents the relationships between different neurotransmitters and in the brain and body, before, during, and after caffeine addiction. The would be a pretty picture. I will try to illustrate the simplest parts of the picture with words.
Generally speaking, the withdrawal for any drug will approximate the inverse of the effects of that drug. and Caffeine is no exception to this rule.
Caffeine acts by binding to adenosine receptors throughout the body (it binds to two of the four adenosine receptors, A1 and A2a, cited from http://en.wikipedia.org/wiki/Adenosine_receptor) , but does not cause those receptors to signal the presence of adenosine. Therefore caffeine interferes with any chemical pathway in the body that involves adenosine receptors, of which there are a great many. This disruption is what causes the effects of caffeine, and it also causes various long term changes throughout the body that roughly lead to tolerance to the effects of caffeine. To understand the withdrawal we must understand the changes that occur to produce the tolerance.
The first change which was alluded to in the description of the question, is the upregulation (increase in number) of adenosine receptors in the body and brain (http://www.springerlink.com/content/p60844816137t021/ suggests that only the A1 receptor is upregulated, at least in mice). I do not believe the mechanism of receptor regulation has been understood yet, but it is known that this is what happens.
Caffeine consumption affects the regulation of receptors for other chemicals, particularly other neurotransmitters in the brain. Studies of the effects of caffeine on mice (cited from Buzz, the Science and Lore of Alcohol and Caffeine and its references, especially http://www.springerlink.com/content/p60844816137t021/) suggest that norepinephrine (an adrenaline like stress hormone) receptors are down-regulated, serotonin (a neurotransmitter which has a huge number of different effects throughout the body) 5HT1 and 5HT2 receptors are up-regulated, and GABA (an inhibitory neurotransmitter) receptors are strongly up-regulated, amongst other possible effects.
There is one catch though, many of these receptors are used for different purposes throughout the body, A1, 5HT1, and 5HT2 for instance. I do not have knowledge of whether receptors change concentrations outside of the brain. I think that the evidence favors A1 being up-regulated outside the body, but I suspect that up-regulation of 5HT1 and 5HT2 only occurs in the brain because their up-regulation is only a side-effect of A1 receptor blockage in the brain. Elsewhere in the body the interaction network of the neurotransmitters may be different, and a different reaction might be elicited.
Since I am completely unable to go through the full biochemistry of caffeine withdrawal (it would also take a lot of space and would be hindered by the fact that the knowledge does not exist to do so), I will focus on the A1 receptor, which is the simplest one to describe since it is the most directly influenced by caffeine.
The A1 receptor is found everywhere in the body and typically inhibits tissue when it is activated. Thus when there are an excess of A1 receptors a larger fraction of free adenosine will be bound than otherwise, causing a larger than expected inhibitory signal to the rest of the body. In the brain this results in an inhibition of dopamine and glutamine, both of which are stimulants of brain activity. In a normal, waking state the brain produces adenosine which builds up and eventually inhibits brain activity by blocking dopamine and glutamine and also restricting blood flow. When there are too many receptors this inhibition happens too early and causes tiredness.
The A1 receptor exists in the heart and all smooth muscle tissue, and is inhibitory in those tissues. In the heart it decreases oxygen consumption, blood flow, and the strength of the electrical signals that drive the heart beat. This causes a decrease in heart rate and a decreased ability of heart rate to respond to other stimulation. It has a similar effect in other muscle tissues. A1 also leads to dilation of blood vessels, and the enhanced dilation due to Caffeine withdrawal leads to the headaches. If this interferes with serotonin in the brain I speculate that this could lead to migraine like side effects such as nausea (I am guessing here).
The A1 receptor also exists in the Kidney and the GI tract, and overstimulation has a number of different effects. Withdrawal is anti-diuretic because A1 in the kidneys enhances the re-uptake of water and sodium in the kidneys. Anecdotally during my latest caffeine withdrawal I gained 15 pounds of water in a very short period of time (this gain was temporary). The effect of A1 in the GI tract is to generally slow it down and this is another side effect of caffeine withdrawal. There are most likely a host of other lower order effects.
I am not going to try and discuss the effects of the other neurotransmitters that are changed by caffeine withdrawal. Likely they have extremely important effects, but since they are being changed due to their role in a complicated network of neurotransmitters in the brain I don’t think I can really say what is going on without full knowledge of the network. This is a more difficult case than A1 which is directly influenced due to its blockage by caffeine. Perhaps an expert can give greater insight.To summarize: What happens in your brain during withdrawal is extremely complicated due to the disruption of the biochemical networks in your brain and body, but many effects can be predicted as just the inverse of the standard effects of caffeine.
My sources are the article and book linked in the text, wikipedia, and lots of personal experience of caffeine withdrawals.
Let me know if you were looking for something different in an answer.