So what is the difference between Plug-in disk deployment vs database deployment besides the obvious.

Well disk deployment is pretty similar to the callout deployment in MS CRM 3.0. The database deployment is the new leap forward. One big benefit of database deployment is that it enables automatic distribution of the plug-in to multiple Microsoft Dynamics CRM servers in a data center. Some thing thing that is not that simple with disk deployment.

A big benefit of disk deployment is that you are able to debug your plug-in, step through your code.