Hey GroundOO,
There are many facts and speculations, but I will just tell you the main reason. Current Intel and AMD CPU's are based on the CMOS (Complementary Metal Oxide Semiconductor) process, and a Duron is not much different from the Thunderbird. The wafers are similar (or same in some cases), so yields are very close. Current Athlon? s scale up to 1.2GHz on the 0.18um, while the Duron is at 800MHz. This basically gives you the needed headroom to overclock a Duron to (close or past) the Thunderbird speed.
Another limit is the on-die cache. Some people think that the L2 is a limiting factor, but it?s actually both the L1 and L2 cache which limit the MHz frequency. Good (expensive) cache can scale to greater speeds, but the less cache you have, the better your chance of hitting a higher speed. Of course less cache hurts performance, but you get the idea.
Edit: Durons also need less voltage and run cooler ( because of less cache).