What's the difference between Office Web Apps and the desktop version of Office?
Not a whole lot. Office Web Apps is a slightly more light-weight version of the desktop software, but it still does all of the core jobs you require. In fact this flexibility around where you work - online or on your desktop - is one of the absolute gems of Office 365. It provides each user with choice. If you're on a computer without desktop Office but you have Office 365, you can use the web apps. If you want the fully featured version of Word or Excel, then desktop Office is for you. Think big spread sheets crunching big numbers, or highly customised Word documents.