I'm sorry that this is undocumented, but out of the box with Handy preset, URLeditor understands 3 types of magic parameters, inherited from 'page' module:
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c=* is understood as structure category code, and so cot_url('foo', 'c=bar') is transformed into /foo/bar or /foo/path/to/bar (depending on $structure['foo']['bar'] contents).
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al=* is understood as alias, so cot_url('foo', 'al=baz') is transformed into /foo/baz, but cot_url('foo', 'c=bar&al=baz') will become /foo/bar/baz.
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id=* is understood as numeric identifier, so cot_url('foo', 'id=123') is transformed into /foo/123.
You don't even need to hook into urleditor to use them.
