Thanks Meter 876
Join Date: Nov 2012
Location: Los Angeles, CA
If you restore your nandroid, you're back to a stock system but still have the custom recovery and - if you messed with those - different radio/hboot.
The RUU gets you back one more step: a fully stock system/hboot/radio/recovery (although that RUU you linked to is rooted, but that's easily fixed).
That's my understanding of it, but I'm also relatively new to the M8 - so take it for what it's worth