Hi Sadhi,
I see no one was able to give you a straight answer… If this consoles you, I’m also struggling to get the difference. However, I can say the main difference is that:
Compare files in the same automation project either in local or versioned files (more details here)
while
Workflow Diff is comparing changes between a process, library, project.json , file in a local repository and the latest version from GIT, TFS, or SVN. (more details here)