Hierarchical schematics allow you to look at your design from a system level view, integration of components, etc .. For example, a hierarchical top level schematic might be a watch design, composed of several other blocks (microprocessor, sensors, display, memory, bluetooth, etc). The top level hierarchical schematic page allows you to see those blocks and their interconnections and to traverse down into them for the particular, individual designs.
Design blocks are reusable schematic and layout components, that you can transfer to different designs. For example, you can very carefully make a schematic and layout for a voltage regulator, or bluetooth circuit with IC and antenna interface, (or whatever you need for your design), and you can save this block of schematic plus layout as a design block. Then, in any number of other designs, you can easily insert the design block (schematic, and layout) and not have to redo that portion of the design. Note you can find many design blocks available for use when you install EAGLE, and you can easily make your own.
Also note that hierarchical schematics (or non-hierarchical schematics) can contain and make use of design blocks.
Does this makes sense?
