There are those that build entirely by hand; but the more common method is to use tools/mods like MCEdit to copy+paste whole sections of blocks. Then you can just build out one of each logic gate/larger section and copy+paste it all together into the full creation bit by bit.

In digital logic design, this is called a synthesis tool. In the design of real digital circuitry, you write a code-like hardware description using a language called an "HDL" (hardware description language) such as VHDL or SystemVerilog. Then a program called a synthesiser converts the HDL into a digital circuit.

Each module is designed this way then hooked up using busses and wires.

In real-life, you would then send the generated design to the manufacturing team

I recommend mattbatwings, he actually does design the circuits and just copy and pastes them using world edit tools

A guy made a GPU a couple years back, also there's that YouTuber who made a neural network and trained it to recognize hand written digits. You draw the digit by walking on a platform with pressure plates on it !