Ultimately it’s just modifying the texture map. Don’t expect it to just be some point-and-click in Unity, or any prescriptive answer here, anymore than it was for the APB developers. I’m sure they have plenty of clever code to give the user such a fluid experience.
But in the end, they’ll just be writing to the image pixels, just as you can in Unity. See Texture2D.SetPixels(), or Graphics.Blit if you’re using Pro.