what is the difference between wifi calling and cellular network calling?

Network calling uses your carrier's cellular network. The signal strength will be displayed in the status bar. Wi-Fi calling routes your call over a Wi-Fi network you are connected to. You need a good Wi-Fi connection for it to work. It has the advantage that it doesn't use minutes from your calling plan, and it can work when you don't have cellular network coverage.

Cellular calls reach the switch via the cell network. WiFi calls go through the local WiFi system to the local router and then pass through the Internet to the switch.

The switch is the mechanism that reads the called number and routes the call accordingly.