Parked domain is an additional domain that points to main directory of your account. A parked domain will resolve to your primary domain name. Say your primary is abc.com and you park xyz.com In the address bar if you type xyz.com it will resolve to abc.com but in the address bar you will see xyz.com. This is a parked domain.
An add on domain allows you to run a separate web site to your primary domain. When you create an add on domain it makes a folder in your public_html folder and you upload the site content into that folder. So essentially you are running 2 separate sites, separate content, off one account. With both the parked and add-on domains, you can create seperate email accounts for each domain name.