Well, sitting/standing is kinda like being at your normal 2D monitor (but in 3d) where you dont move, except that you can look around and move your arms (hands) around to grab/interact with stuff closeby. In this setup you normally use your controllers to turn and move in the gameworld, without physically moving your body other than your head and hands.
Roomscale however lets you define the borders of a physical space of yours, in which you can freely move around as you wish. In both oculus and steamVR the boundaries of your roomscale is customizable within the games so that you can see virtual walls appear in the game when you are close to an actual physical boundary that you have defined. You can also turn off walls and put boundaries instead, which result in an outline being shown on the virtual floor where you have defined your physical boundaries (or you can be daring - and probably dumb - and turn it off completely, and find the boundaries when you hit your fist/controller/head into something preferably not your wall, desk, wife, child or dog hurting something in the process haha)
So basically, the difference is more or less having a space where you can more or less only use your hands and head, and having a space you can “walk/jump/crouch/crawl/be silly” in while interacting with the game world (and not get hurt in the process haha).
The roomscale system in oculus is called “Guardian” and the roomscale system in SteamVR is called “Chaperone”. But essentially they do the exact same.
All that being said, both systems have their own definition of optimal roomscales. And while i don’t remember the exact numbers, optimal roomscale is in the ballpark of 2-3 meters on each side. Don’t let that scare you though. If you have a space where you, while standing up, can ensure you aren’t hitting anything in 1x1 m or so, then that will work too. It will be somewhat cramped, but you will still get a much larger immersion than if you had less
Edit:
In roomscale you STILL use your controllers to move around, but you have a much higher degree of freedom within your space
Edit 2:
Sigh, all these edits. Sorry, it is friday and i’m working on getting drunk, so excuse any missing words and possible bad grammar above