Genotyping only returns variants of interest (SNPs) which are specified up front -- not the full sequence. It's a smaller dataset.
Sequencing gives you the full genome -- which is currently too expensive to do at consumer scale (though prices are falling). 23andme does not do this. This means the type of genetic research that 23andme can do is somewhat limited.
[1] https://customercare.23andme.com/hc/en-us/articles/202904600...