Confused the heck out of me, too.
The USB memory is part of the 4gb internal memory which can be used for storing media. If you don't have an SD card, this is where your photos get saved. Confusingly the USB memory is listed under /sdcard in the filesystem.
The SD card itself is mounted under /sdcard/external_sd. After some testing using ES Explorer, I have determined conclusively that when you move an appointment to SD, you are really moving it to the external SD. However most third party apps will attempt to store their data in the USB memory by default (eg. Gps apps that download maps seem to want to use the USB storage and don't seem to want to use the external sd)
