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Featuring content on your timeline allows you to proactively bookmark something as important to you. You can see that photos are in high-resolution, and everything is documented from the middle timeline vertical bar. You can also go through and edit visibility settings, to allow or disallow more or less people to see the content you publish, and also the added bonus of being able to delete content from your timeline. It will be as though it never existed.
Covers are images that you can upload, or have already been uploaded to your profile. They act as 'main images' to your profile page, for which others can see. You can reposition the image as you wish, and it can be anything you like.
You can still do all of the regular stuff that you previously could do -- such as writing status updates, or checking into places, or even uploading photos. But here, you are given more additional options to categorise exactly what you want in your timeline. So, you can add life changing events or rites of passage, or just a status update. As with the slightly older profile, you can tag places from the desktop instead of using your mobile phone.