b = (b * 0x0202020202ULL & 0x010884422010ULL) % 1023;

The multiply operation creates five separate copies of the 8-bit byte pattern to fan-out into a 64-bit value. The AND operation selects the bits that are in the correct (reversed) positions, relative to each 10-bit groups of bits. The multiply and the AND operations copy the bits from the original byte so they each appear in only one of the 10-bit sets. The reversed positions of the bits from the original byte coincide with their relative positions within any 10-bit set. The last step, which involves modulus division by 2^10 – 1, has the effect of merging together each set of 10 bits (from positions 0-9, 10-19, 20-29, …) in the 64-bit value. They do not overlap, so the addition steps underlying the modulus division behave like or operations.

The genius here, I think, is the modulus division to compress eight specific bits from a 64-bit number down into an 8-bit byte.