I can give you a pretty good idea how it's done in the Lowcountry.
1) Teams play schedules, establish Region standings.
2) All-Region teams selected, with slots allotted based on team's final standing (i.e., more slots to Region champs). Coaches essentially fill the slots they're given.
3) Newspaper's high school correspondent references All-region teams, then selects All-Lowcountry team "in consultation" with a handful of coaches.
Note: The same reporter/correspondent who finalizes the list generally has seen (maybe) half of the teams/kids actually play, therefore is largely reliant on coaches to get it right.