Difference between this and Mime Mail ?

me too.

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Mime is an encoded attachment, ie. allows embedding images. HTML mail is the use of tags to format text, link to images etc. and the preferred format for email marketing.

HTML: http://en.wikipedia.org/wiki/HTML_e-mail
MIME: http://en.wikipedia.org/wiki/MIME

Uses:
If you want to attach a binary file to email definately use Mime
If you want to send pretty system emails with marketing or newsletters you would use HTML Mail

Thanks Chris for the clarification!

Something more. When you send email using Drupal, it is plain text. When you send HTML email, it is read as HTML in email clients set to read HTML but appears at gibberish in email clients set to display plain text. mimemail lets you send HTML email with an automatic conversion to text. The text is placed in the email along with the HTML version mime encoded. Email clients set to plaintext only will read the plain text. Email clients set to read HTML will read the mime encoded HTML portion. I am changing my sites to mime mail so that everyone can read the email.

Mime Mail does not let you see the plain text version of the email before you send the mail. A better system for both mail modules would be to let you enter HTML into a node, preview the node as both HTML and plain text, then edit the plain text if the conversion from HTML to plain text is not satisfactory. You could then send your email knowing that both the text and HTML representations are perfect.

Now I am an expert regarding the differences... Thanks!