From Chapter 3: In the Toolbox

Node Instances are clones of the original geometry of a figure or object but don't consume as much RAM as the original so can be used to populate crowds or a field of flowers or other multiples in the background. However you can't change the surfaces or poses on an instance. A single new instance will load in the world center or 0,0,0 on the X,Y and Z axis, even if you have moved your object. 

Duplicates are exact copies of an original object or figure and this includes the polygon count! They can be moved, posed and have their own textures applied as if they were the originals. They load in place as the original figure.

Tip: Make sure that you have parented any clothing or props added to your object or figure, before creating a new instance or they will appear naked!