A custom site domain is typically a primary domain used to access pages within the site. A site can have one or more site domains.
A development domain is free to use and may look like mysitename.live01.dev.marketpath.site. These domains are used during development of a new site when the production domain is currently in use on an old site.
Redirect domains are used to redirect vanity domains or domain variations to a primary site domain. For example, if your domain is mywidgets.com, you could redirect mywidgets.net and mywidgets.org to your primary domain, mywidgets.com. Another use is to register common misspellings of your domain and have those redirect to your primary domain.