I'll do my best to explain the different types.
Obviously, there's the main categories you see on the vault. Subcategories are listed below the main six (audio, sfx, characters, items, misc, stages)
Audio: this is pretty much self explanatory. Replace any song in the game, including victory taunts (the short theme that plays after you win a match). Make sure non-victory-taunt songs are "looped" so they repeat when you battle on a stage, or are scrolling through the menu. Otherwise, they just stop and there's no music.
Characters: replace character
---Textures: adds a new skin (like the recolors in the original vBrawl) but does not change the shape of a character
---Vertexes/Model edits: changes the shape of a character (such as adding a hat, making a sword longer, etc)
---Imports: pretty much the same thing as a vertex, except that it uses a newer method to put character models into the game (rather than being restricted by factors such as needing the same number of vertexes, brand new models or models from other games can be put into Brawl. Imports must be "rigged" to a skeleton; this is the process of making vertexes follow the bone structure of characters so that they look like they're moving their arm during a moveset.)
---PSAs/Movesets/Motion: These can drastically change characters' attributes and/or animations. While a vertex or import may allow Ike to
look like Cloud, a PSA (Project Smash Attack) changes his attacks, weight, animations, speed, and all of that so that he acts like Cloud. While textures, models, and imports are "one-slot" (as in, they only affect red Mario, but not blue), PSAs and movesets affect all of the color slots of that character. So you essentially decide to get rid of the old character's vBrawl moveset when you replace it with a PSA hack.
---Other: "effects" replace things like Fox's blaster color and the like (applies to all slots), "Final Smashes" replaces final smashes (however, Fox and Falco share the same FS), "KHats"/Kirby Hats replaces the model that goes on top of kirby's head when that character is sucked in (although, Snake and a few others give kirby a new texture, such as a beard). KHats go under the /fighter/Kirby folder though.
Stages: what you play on. Like characters, they can be textured, model edited, and model imported. Stages, like characters, are meant to only work on the stage they were designed for. However, "rel porting" allows stages to replace any other stage slot (or make new slots in the stage roster); a Final Destination based stage can replace the Pikmin stage if a st_final.rel file is placed in the module folder and renamed st_pikmin.rel
Items: replaces items. Textures, models, imports, and occasionally their attributes (item's equivalent of a PSA). Items are all stored in one file however, common5.pac (or is it common3.pac?) which needs to be opened up in Brawlbox to edit and replace individual items.
SFX: Replaces characters voices and other sound effects. Not compatible with Gecko OS users- only Riivolution. (however, personally I prefer Gecko despite this, since Riivo has certain limitations and glitches with other stuff). SFX files require Sawndz to replace.
Misc: This covers stuff like SSE enemies, trophies, menus, stickers, and replacing the intro video (intro video can only be replaced using Riivolution)
Another thing you'll notice in the Vault is the label "wifi-safe". This tells you that a match won't desynch when playing online against someone without a modded brawl; it will also allow you to watch hacked replays with hacks off, without desynch.
Obviously, anything editing movesets or other attributes (such as stage layout/boundaries, items) will desynch matches, but on rare occasion model edits will do so as well (refer to the wifi safe label to find out). If the hack is only a retexture, it's virtually always safe. Other things like audio and menus don't matter since they don't interfere with gameplay.
This is more for setting up a hacked Brawl, but it still explains several things.
http://forums.kc-mm.com/index.php?topic=12169.0feel free to ask any other questions.