the rodwell where they melt the ice for their water makes a big cavern in the ice. the previous rodwell is used for all greywater/human waste, indeed making a giant shitcicle. when the current freshwater rodwell is done, they start a new one and that one becomes the new dumping one.
There's another post on his blog about visiting the sewage treatment plant at McMurdo (not Pole, I don't know what they do there). At McMurdo it's like any other sewage treatment plant: they release the cleaned water into the sea.