Envelopes are used to send a file, add fields to it to fill out electronically, and send to a specific set of people. When using the envelope feature, it would send a unique, one-time-use agreement and not reuse the same envelope document again.
The difference between an envelope and a template is that templates are used to quickly send contracts or agreements that you use often. The form typically stays the same, and the only things that changes are the data collected and the signatures. Once your PDF form is turned into a template and all fields and parties are added, you can quickly and easily send envelopes from the template without having to add fields each time.