Hard drives have a built-in partition table on the MBR. Due to the structure of that table the drive is limited to four partitions. These are called primary partitions.
You can have more partitions by creating virtual ( called logical ) partitions on one of the four primary partitions. There is a limit of 24 logical partitions.
The partition you choose to split into logical partitions is called the extended partition, and as far I understand you can have only one.
The advantage to logical partitions is quite simply that you can have more than 4 partitions on a disk.
You should be able to install any OS on all of the partitions.
See this page for more details
In the current IBM PC architecture,
there is a partition table in the
drive's Master Boot Record (section of
the hard dirve that contains the
commands necessary to start the
operating system), or MBR, that lists
information about the partitions on
the hard drive. This partition table
is then further split into 4 partition
table entries, with each entries
corresponding to a partition. Due to
this it is only possible to have four
partitions. These 4 partitions are
typically known as primary partitions.
To overcome this restriction, system
developers decided to add a new type
of partition called the extended
partition. By replacing one of the
four primary partitions with an
extended partition, you can then make
an additional 24 logical partitions
within the extended one.