Hey, there! Glad you are checking out my jazz lessons. :)

Originally Posted by: find_ch
In the higher forms, he actually shows the A7 as an alternate for the C#dim7, which sounds great. My question comes when he explains that the C#dim7 is actually a substitution (the 7 of 2) for the original Am7 (6 chord). In effect, how does the higher A7 work to 'replace' the originally intended Am7?

Good observation & question!

You've answered the question in the first line: it sounds good. :) But in more depth, an A minor chord is the naturally occuring chord in the key of C major. But in order to make it sound jazzy, I've included a modulation via a note that isn't part of the key (C#) and as a result a chord that's not in the key (A7 or A7b9 or C#dim7).

The first thing I did was to replace the C in the A minor chord with a C# because it's only a half-step from D, which is the root of the next chord.

a-c-e
a-c#-e

So, now we have an A major. Next, we can put a G in there to make it a fully dominant 7 chord, good jazzy sound & a great way to make a V7 of I (A7 to D).

a-c#-e-g

Finally, I can add a B-flat making an even jazzier sounding chord, an A7b9.

a-c#-e-g-b-flat

But, if I don't include the root note A, then another way of spelling this chord is C#dim7.

c#-e-g-b-flat

All of them are basically just a way of providing a voice-leading, dominant function way of getting to the next chord, the D minor.

I explain a bit more about this in the Intro to Jazz Rythm Guitar tutorial 3rd lesson.

http://www.guitartricks.com/lesson.php?input=21171&s_id=1697

And there is even more about how that sort of thing works in my Extended Harmony Chord tutorials.

Hope that helps! Ask more if necessary & have fun learning some jazz. :)