I am often asked to explain about the different deployment options available for CRM and if there are any features that are not available in the specific deployments.
Basically, you have 3 deployment options. The names of each have changed slightly so can be a little confusing:
1. On Premise: Gives you the full control over the setup & administration of your CRM & server platform. Available in Workgroup, Professional & Enterprise Versions
2. Online: Utilises the power of Online Services combined with your local office apps to provide you with a way to quickly get up & running with Dynamcis CRM. Its basically a hosted version of CRM managed by Microsoft. Its available in Professional & Professional Plus Versions.
3. Partner Hosted (Internet Facing Deployment): Work with one of the worldwide Microsoft Partners who host and manage your CRM implementation and provide end user support. Some even offer industry specific, or locational specific solutions.
As for the Feature comparison between the different versions, I always find myself referring back to the following MSDN article http://msdn.microsoft.com/en-us/library/cc462942.aspx as it provides not only a lovely graphical representation, but also breaks down into tables for each area of functionality, what is available & what isn't for each of the above deployment options.