Pictures vs Photos

The Pictures in your Sidebar is a shortcut to a folder within your home folder, called Pictures. That's all it is. Many image management or editing apps would expect your photographs to be stored in the folder, by default, but they don't have to be. You can store them anywhere you want.

Photos app is a photo manager. If you choose to use it - and it's not compulsory - it will manage you images, share them across devices, allow good quality basic editing as well as other features. There are several other apps you can buy to do the same job with more or different features.

By default, the Library for the Photos app is in the Pictures Folder- but it can be put anywhere you like.

So, one is a folder, no more, no less. The other is an image management system.

"Pictures" in der Finder's sidebar is just a predefined folder. Many applications are looking there for photos by default, so you should use this folder to store photos and your photo libraries.

The Photos.app is a basic application. preinstalled on a Mac, that you can use to manage your Photos. The Photos.app will create a database, the Photos Library, and by default it will create this library in the Pictures folder.

It seems to me that The Pictures folder is simply where your photo libraries are stored. I have created other folders within the Pictures folder to store images that I do not want to import to the Photos app for one reason or another.