Let me see if I can clear this up a little bit better for everyone. There are two very distinctly different things we refer to when we say "root". Okay, there are actually three, but one of them has nothing to do with this, really. In the true sense of the word, root means you have full permissions to the system (admin, if you will). It also means you can run apps as the root user. This sort of thing is what we refer to as soft-root. It is only at the ROM level, and means you can do things as the root user. The absolute guaranteed way to see if you have this type of root is to open a terminal emulator, and type "su". That is the unix command to become the root user. It stands for superuser. If the prompt changes from $ to #, it means you have become root. Now, out of the box, just like that, you wouldn't be able to run any root apps. The reason is that root apps still need to have permission to run as root. The only way they can get that is if you grant it. And you can only do that if you have the superuser app, which will allow you to do so.
The second part that we refer to as root is full root, or as some say, permanent root. As you know, it's not *really* permanent. The Evo, in particular, along with certain other Android phones, come with what is called locked nand. Nand is just the type of internal storage. What this means is that certain internal partitions on your internal storage are locked. Any attempt to make changes to them will not be saved. If you have root level permissions in your ROM, by virtue of the fact that you have root, you can make changes to the system partitions while in your ROM, BUT they will not stick. If you reboot, they'll be gone. It's locked at a lower level than the system. If you go to hboot, you see this as S-ON. It means security is on. This second part of root will change that S-ON to S-OFF. That means security is off, and nand is unlocked. You can then make changes to all partitions on internal storage. The "normal" way of getting this type of root is to flash a different hboot, known as the engineering bootloader. Unrevoked gets around this by setting S-OFF at a lower level than hboot. The term "permanent root" sort of came out of that. Root via the eng bootloader only lasted until you lost the eng bootloader. With unrevoked, it's "permanent" in that you can switch hboot versions, and S-OFF sticks (brief rabbit trail - that's not a good idea; it's just possible).
Anyway, the point is that these two types of root are separate, but used together. You can have one without the other. You can have a rooted ROM without S-OFF. This is what z4root does. We call it temporary in this case because you have to run it again after a reboot. You can also have S-OFF without a rooted ROM. It's pretty much pointless, but it's possible. So, if you run the terminal emulator test, and you have the superuser app, it means you have a rooted ROM only. It does *not* mean you have S-OFF by default. The only test for checking that is to boot into hboot and check.
So, S-OFF really can only be taken advantage of in two ways. One is to make changes to internal partitions while the phone is booted up. Using something like root explorer, you gain the ability to run it as root with a rooted ROM, then have the ability to change a partition like /system since nand is unlocked. You need both levels of root here. The thing is, this is somewhat limited. It's meant for one-off changes, really. You can't go replace the entire system like this.
To make S-OFF useful, and take full advantage of it, you need a small operating system that runs on the side that you can boot to while the main Android system is off. This is recovery. Recovery is a small OS in itself that has the ability to fully read and write to the Android system. With S-OFF, you can now change whatever you want, and recovery makes that useful. So, when you flash a new ROM for example, you're overwriting entire partitions that are otherwise locked.
So, what does unrevoked3 do that unrevoked-forever doesn't? Unrevoked3 does all of the above. It grants your ROM root permissions, it runs unrevoked-forever (which changes S-ON to S-OFF, only), and it gives you a custom recovery. Unrevoked3 is the entire process that makes root useful. Unrevoked-forever is just part of it.
EDIT: Oh, and in case anyone is confused, soft-root is more what I would consider root based on what root really is on a Unix system. S-OFF, while "full-root" is more of a system of unlocking internal storage.
My userid is the same on the XDA (mikfroyo) site so feel free to ask in there as well, if you move that route. I'm still very new and don't know any where near as much as a lot of these guys know. Hell they've probably forgot more than I know.
Most if not all of this information is covered in the OP, but I understand it's a lot to take in. Also XDA is a great site to find answers as well.
