I'll say it like this, and somebody correct me if I'm wrong...
When a photosensor on a digital camera gets to the point that it is completely exposed, it cant expose any more. What happens is that "energy" that is on that single photosensor bleeds over onto a nearby photosenser(pixel). What happened in that picture I posted is that the reflection of the flash was the most exposed point in that image, so exposed in fact (at that small point) that it is really overexposed. So much so that the surrounding pixels are exposed a little extra. When you see that somewhere where a very dark border meets a very light border (like where the white reflection meets the black pupil) you get blooming. What is seen here is an increase of "purple fringing" due to that bleeding over of energy.
Why? Physics of light. different wavelengths of light refract (or bend) at different angles when they pass through a medium, in this case a piece of glass acting as the lens of the camera. Because some bend a bit more or less than the others you can see that they did not hit the exact same place on the pixel.
Think PINK FLOYD:
see, white light comes in, but the separate colors of white light (the color spectrum) separate when they goes through the glass.