What kind of meshes does Skin allow?   

Basically only chess board like meshes are allowed.  This meshes can be closed (cylinder like, torus like)  It is allowed that boundary curves degenerate to a point 
   - If one boundary curve degenerates, we have some kind of "triangular surface" 
   - If two opposite boundary curves degenerate, we have some kind of "banana surface" 

What is the basic difference between InsertFace and Skin?   

InsertFace only allows boundary curves (no inner profiles) InsertFace allows from 2 up to 6 boundary curves (with the exception of planar profles).  Skin allows 'infinite' number of edges  InsertFace allows faces beeing generated from two edges not forming a closed loop. 
   - i.e. Insert will add the missing edges as straight lines and generate the closed loop.  The resulting faces generated by "SKIN" require less amount of data than those generated 
   by "InsertFace" 

How can I guarantee smoothness to adjacent faces in the skin operation? 
The resulting surface will be smoothly connected to a neighboring face 
(i.e. the angle between the faces is smaller than 1 degree (see VDA Recommendation 4955))  if all curves at the vertices are connected in a tangent way 
   (see picture 1, yellow edges at all four vertices)  if all inner curves of the mesh (when skinning) have a tangent continuation
    on the neigbored face. (picture 2, red curve). For a violation see picture 3 
 

picture 1	picture 2	picture 3

REMARK: In many cases the neighboring face is generated by Skin as well. So you might have either some 2D or 3D curve, which generates the common boundary. In this cases if you want to achieve smoothness you may not select this origianl 2D or 3D curve, but you MUST select the edge of the neighboring face. To guarantee the correct selection you can remove the 2D or 3D curve from the drawlist and select the boundary edge of the neighboring face. (Only by selecting the edge of the neighboring face SolidDesigner knows about the neighboring face.) 

What is the basic difference between Cap and InsertFace?  Cap allows and will always create a smoothed vertex  InsertFace can not have a smoothed vertex (no face-internal capping point)
 

What is the basic difference between Cap and Modify Node?  Cap will not modify the generating mesh of the surface  Modify Node will always modify the generating mesh of the surface  Cap requires a part / solid, it can't be applied to FaceParts  Modify Node works always with surfaces (of a solid/part or a FacePart)
   Note: This could cause difficulties if trimmed surfaces are modified, 
             i.e. if BLEND faces have been applied to the original part. 

What is the basic difference between Skin and Loft?  Loft always creates a complex part using only a single operation  Loft allows less controll on the created faces than Skin  Skin always results in a surface 
    (if used to add a missing face of a closed shell, this will be converted to a solid part)  Skin is more laborious then Loft 

How can I use the Mesh command in the 3D curves menu? 
To extract the mesh (that generating the surface) from a surface. 
This is can be useful to modify the surface or to see how this surface was build.