Okay forget patents/licences I don't want another b@$tch fight happening
What makes the commerical ones techincally better also forgetting speed optimisations. Now is it just more accurate calculations or what? I haven't really looked at the spefication all I can guess is some of the operations are very losely defined and the difference come from how they are implemented.

There really is no standard difference. In practice though, most commercial AAC encoders use some sort of encryption to make the bitstream unreadible without a specific program. Liquid Audio does this for example. However, this has no relation at all to quality.

ISO AAC can be just as high in quality as any commercial non-ISO (or even ISO) encoder. Most ISO (or more properly, most non-commericial) AAC encoders though (I don't even know of that many) are not as likely to be as high in quality as a commerical counterpart, usually due to the fact that they are not developed with as much resources behind them. This isn't always the case though, shown by the excellent quality PsyTEL offers, which is at least reported to be better than most other commercial implementations with the exception of the Fhg MPEG-4 AAC Main Profile encoder.

If by ISO encoder/decoder you meant ISO reference code, then the quality of those is awfull.

People,

All AAC encoders >MUST< be ISO compatible on the elementary bitstream level in order to get qualified for the patent license.

Also, all AAC consumer software coders must have "closed loop" i.e. some kind of encryption after ISO bitstream is produced in order to get AAC patent license.

So, basically, all AAC encoders are ISO compatible, but some of them must have additional encryption layer because of copy protection.

1. AAC Professional Products (not end-user software):

[encoder] -> [iso bitstream] -> [decoder]

2. AAC end-user software:

[encoder] -> [iso bitstream] -> [encrypt] -> // transport or storage // -> [decrypt] -> [iso bitstream] -> [decoder]