From what I gather about the Rods:
Yep, gravity is used. One neat thing is the launcher satellite it is going at orbit velocity which at a 150 mile altitude is about 17,000 MPH. So the projectile gets one hell of a speed head start.
Speed degrades when entering the atmosphere, but with the start velocity and the low cross-section of the projectile the terminal impact speed on scrubs down to around 10,000 MPH or +/- Mach 14. KE = 1/2 mass x velocity^2.
Now THAT is a BOOM!
And much better than flattening an entire city block just to nail a 50x50 target.