Getting the SharePoint Terminology Right
Years ago, when I was trying to figure out Excel VBA, I drew myself a picture of concentric circles to understand the relationships among cells, ranges, worksheets, and workbooks. It helped! I've tried to use this method recently with a few folks as I explain the various levels of SharePoint 2007.
I didn't have the time to draw the picture so I'll leave it to your imagination...
Web Part - Components that display content on a page and are the primary means for users to customize/personalize pages.
Web Part Zone - Container for Web Parts.
Page - Container for Web Part zones, and Web Parts.
Site - Container for child sites, pages, and content such as lists and document libraries.
Site Collection - Container for SharePoint sites, which exists within a specific content database. A site collection contains a top-level site and optional child sites, and is the unit of ownership, securability, and recoverability.
Web Application - IIS Web site, extended to use SharePoint, which can host site collections.
Farm - Installation of one or more load-balanced Web servers, and back-end servers, with a configuration database.