A real tilt-shift picture requires a specific kind of lens that has moving (tilting/shifting) parts. That means that the camera, or more specifically, the image plane (film/sensor) remains in the same place while the lens moves. This effect causes the rest of the image to become blurred while a specific area is kept sharp - this is also known as selective focus.
At least this is what I understand. I never tried using a tilt/shift lens myself so I only have the theory, not the experience.
As for why, that's a trick your brain plays. It also helps to make the colors slightly more saturated to enhance that "plastic texture" in the picture. This one had saturation up to around 75%.
@Shomari:
Yeah...using the facebook link didn't really help either. So I changed it to the one in my dA account. I'll keep your suggestion in mind next time I do pseudo tilt-shift photos. Thanks =)