Some good info and references have already been posted, but another
place to look is "Beneath Apple ProDOS" (the follow-up to "Beneath Apple
DOS"). It covers GCR, nibblizing and the state machine, and includes a
dump of the PROM. It references "Understanding The Apple II", which I do
not have, so I don't know if their content is orthogonal.
Also, I remember hearing that there's some info in the manual that came
with the Disk ][.
-- Adam