Your thinking, far, far, far too much about it!
You need to just do it, and it will work, and then you can worry about how its actually working. I've never known anyone to make a butterfly seem so complicated in my life!
But anyway, to get you on track with it, the above advice is good, but can also create tangling/hitting problems. If you find that doesn't work for you, another strategy is to have one arm (to make it easier to understand I'll say right, but it could be your left if your more comfortable with that) diagonally above the other.
So your right hand is above and right of your left hand. Importantly, your right hand is also SLIGHTLY(your hands are almost at the same level) in front of your left hand. Now, this is fine of course, until your left poi wraps around your right hand. (If the poi wraps around your arm or wrist, then you are holding that hand far to far in front, pull it back).
Pay attention to where in the circle this happens. You'll find its when your left poi is coming down in it's circle. So from your perspective its when your left poi is at 3'o clock. So at this point, what you need to do is to very, very, very slightly, pull your right hand back, out of the way. Its a very subtle movement, which should almost be subconsious. If you pull to much, then you will pull the poi out of the plane. Don't think about it too much! If your left poi is brushing the front of your right hand then you are getting it almost right.
This will look messy at first, but with some practice it'll look fine.
The other way to do it. Which is not a great way as you have to bend your planes, but is a very useful teaching/learning technique, is to start spinning circles by your sides (like you would before doing a weave- no crossing over), and slowly bend the poi in until they're in front of you, and before you know it, you're doing a butterfly. As soon as you can do a butterfly, learn how to stall one poi over the arm (if you need help with stalls, then I'm sure theres info on that) and change the direction of the poi, so that you can go from a weave to a butterfly and back again without stopping your poi, or bending your planes.
Good luck with it. Don't think too hard, just let it happen. It works because poi are not wide solid things, but bendy, thin things that can cope with slight brushing of each other and moving in very confined spaces and still keep going. Keep us posted on your progress...