Align will align multiple objects to each other based on the
button -- in other words it will make all selected objects left
edge, horizontal center, right edge, top edge, vertical center, or
bottom edge all the same position.
Distribute will space all selected objects so they are the
same distance between each object based on the button you press --
in other words it will make the distance between each objects top
edge, vertical center, bottom edge, left edge, horizontal center,
or right edge all equal distances from each other. The Space
commands differ from the Distribute commands in that they rake into
consideration an objects size, so that the "white space" between
objects are all the same -- I use the Space commands more
frequently than the Distribute commands.
Best way to understand this, though, is to create 3 or more
objects and start playing with the buttons.