Knitting flat is when you knit across the row then turn and knit across the other side. You can use 2 straight needles or a circular needle w/o joining the work. It creates a flat piece of work. This is the best one to use to actually learn the technique of knitting.
The other type of knitting is 'in the round' when you use use double pointed needles, 2 circulars, 1 circular or magic loop. When knitting in the round you create a tube of knitting and only knit on the outside.