Family/Peer Group vs Linked Attendees Group

What are "Linked Attendees Group" and a "Family/Peer Group" Registrations?
How is each created and when should they be used?

Linked Attendees Group
When you are registering more than one person, you have the option of having those registrations "linked" so that multiple registrations can be paid at the same time, be placed directly in rooms and be edited by the group coordinator. One person is designated as the group coordinator but individuals within the group will be given access to actions for their particular registration, but only the group coordinator has access to all records in the group. There is no limit to the size of the group. This concept is explained in much greater detail in the answer titled, "Linked (Group) Invoices."

Family/Peer Group
A Family/Peer Group is two or more registrations where one person is designated as the "Primary" contact and the others are listed as members of that group. The registration page for the "primary" contact will contain additional information (e.g. the address, travel plans, etc) that the regular group member pages will not contain that information. The creation of a family/peer group automatically also creates a linked attendee group. This option is activated by an adminstrator using the "Register As" option.

A key example and usage of this is a family. One of the parents is designated as the primary contact, the spouse and kids are then regular family group members. So the primary parent fills out the family address, travel plans (the assumption is they will travel together) and housing information, but the rest of the group members do not fill in that information. This works as well for a couple registration or for an office team traveling together. You can read more about this in the answer "Multiple Person Family Registrations."

When to Use Each One
By default, the Linked Attendees Group option is always turned on thus allowing for people to create groups. It can be turned off by an administrator as explained here." The only time you wouldn't use this is if you wanted to restrict a site to one registration per person.

You would activate and use the Family/Peer Group option when you know you will have couples or families registering. It will be required if you're using the childcare option.

The place where this usage becomes a toss up is an event where your majority are single registrations and only a handful of couples. If you leave Family/Peer turned off (e.g. no "register as") a couple will still be able to link their registrations and the only downside is that both husband and wife will need to fill out travel and address information. 

Activating the Conversion Phrase
If you use the "Register As" option (single, couple, family, family one parent) as anything other than "Single Only", then the attendee will be given an option of converting their registration to a family/group registration. The phrase "To convert this to a group registration (a "family" is considered a group)" appears on the enduser home page blue box. When checked, it automatically converst all of the attendees on that record into a family group.