Apple Pay (Apple Wallet): differences and setting up with multiple credit cards?

Today, I was setting up a payment method via Mobile App. Let's say for example it was McDonald's (it wasn't).

The app asked me what payment method I wanted to use: Apple Pay or another method. I became confused at this point. I have about 5 credit cards within my Apple Wallet. Whenever I use any of them for a payment at a POS (Point of Sale) terminal, my iPhone says Apple Pay and that credit card I used.

Depending on my needs and acceptance, I use different payment methods setup on my iPhone. I do not have Apple Pay linked to my bank account, and I do not have an Apple Credit card.

To further elaborate, I needed to make an electronic payment on the spot so I didn't want to risk any issues so I manually entered one of the credit cards that I have stored in my [Apple] wallet.

As such, I'm confused what would've happened when I selected Apple Pay? Would I be provided an option to choose which credit card (payment method) I can use when setting up my Apple Pay profile on the app? And how would I go about changing it?