Layout Mode creates a consistent look for all posts –– both current and future. The Layout Mode is your design center. Here, the post’s main components (title, etc.) are connected to the design elements you want to set (layout, etc.) to give all current and future posts a similar look.
Post Mode represents flexible content. In Post Mode you can write and customize individual posts without breaking the layout. The Post Mode is where you write and customize your post. Editing a blog is just like editing a page, and your words will stay put while you add widgets and unique design elements.
For more information, see About Blogs.