I've been using Foobar for a while but have yet to find out what the difference between an active and a playing playlist. In my context menu I can change a playlist to active/playing but it doesn't seem to do anything. Help would be appreciated.

maybe you should desactivate "cursor follow playback" and you might see the difference.
As the "title" lets suggest, you can manage different SCPL. One can show always the playing Playlist, and the other, the active one. But if active and playing is the same one, that's right, you will no see any difference.

The active playlist is the one you are currently editing. The playing playlist is the one that foobar2000 is currently using to schedule songs.

I guess you are talking about the Single Column Playlist View since that is the only one that has such entries in its context menu as far as I know. I'm not really familiar with it, but I think this option only takes effect when you use more than one playlist view at a time - or at least that's the only time it is really useful.