Okay, consider this example. Thag and Thog are two orcs defending a room in a dungeon. They know the PCs are coming. There's no door to this room - the hallway just opens into it. Thag stands right by the entrance (where he can't be seen from the hallway) and readies an action to hit the first PC through with his greataxe. Thog stands a ways back from the entrance, in a straight line so he can see down the hallway, and readies an action to fire his longbow at the first target he sees.
The party comes down the hallway. They see Thog and he sees them at about the same time. Thog's readied action goes off and he shoots the lead PC.
Then, the PCs roll initative to determine the order they go on. Thag doesn't roll initative because he still has his readied action. And Thog doesn't roll because his action just went off, so he can't go again until all the PCs have gone. Is this right?
Say the lead fighter wins initative, and he decides to charge Thog. As soon as he enters the room, Thag's readied action goes off and he hits the fighter with his greataxe. The fighter is still charging, so Thag gets an AoO on him as he leaves the threatened square right in front of the entrance, and he hits him with his greataxe again. If he survives, the fighter can then complete his charge against Thog.
And then, the rest of the party knows about Thag, no one has any more readied actions, and so combat would proceed normally.
Is that how things would work, given the above example?