Also, what happens to the kids of British parents who go to live abroad if the kids only speak English? Are the kids just put into a school class that matches their age?

In my experience of living in 3 non English speaking European countries, either the children go straight into their age appropriate class in an equivalent of our "State" school or, they go to the local International School (either British or American) where English is the working language with many different nationalities attending.  

Children have an ability to pick up a language very quickly but only if they have been schooled in their own language from a young age.

It's likely to be difficult for children coming to the UK and 9 being the starting age of their school life, particularly if they've come from the poorer areas of Asia.