Let $\varphi :\mathbb R^{N}\times \mathbb R^M\to \mathbb R^N\times \mathbb R^M$ a bijective function defined as $$\varphi(x,y)=(x,F(x,y)),$$
where $F:\mathbb R^N\times \mathbb R^M\to \mathbb R^M$. Denote $\psi=\varphi^{-1}$.
Why is there a function $G:\mathbb R^N\times \mathbb R^M\to \mathbb R^M$ s.t. $$\psi(u,v)=(u,G(u,v)) \ \ ?$$
I denote $\varphi=(\varphi_1,\dots,\varphi_N,\dots,\varphi_{N+M})$. Since $\varphi_i(x,y)=x_i$ for all $i=1,\dots,N$ it's clear that $\psi_i(u,v)=u_i$ (since it's the identity), but if $i>N$ we indeed have that $\varphi_i(x,y)=F_i(x,y)$, but why will we have a function $G$ s.t. $\psi_i(u,v)=G_i(u,v)$? Is $G_i$, the inverse function of $F_i$? If yes, I really don't see why.
First off, constructing $G$ is simple, if we have $\psi$: just take $G(u,v) = \pi_2 \circ \psi(u,v)$, where $\pi_2$ is the projection to the second set of coordinates (in your case, the last $M$).
To answer your second question $G_i$ is not the inverse of $F_i$: we have that $F_i, G_i : \mathbb{R}^N \times \mathbb{R}^M \to \mathbb{R}$, so the domain of $G_i$ is not equal to the range of $F_i$.