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Basically by default the unstable branch is the middle form between the stable version and nightly updated branch.
The stable branch is the normal one, and this new one is now both unstable & nightly branch. In the unstable one though you would have to manually setup it to do nightly however, if desired.
Nightly has more recent stuff, but be warned as you may lose things here and there due to bugs. It is the buggiest version, and runs nightly hence the name. Which also means lots of downloading mostly daily.
The default option for that install, being the unstable branch doesn't update quite as often but is the middle ground before it goes stable. Usually when something hits unstable it is usually 3-6 weeks after to hit stable; depending on how testing goes and if things are stable enogh to be pushed to the normal instal. This branch might be still buggy, but not as much as the nightly; however more than what stable would be.
Really though I would probably stick with the stable one as that separate install is mainly for those with some patience enough to deal with the possible bugs and only really good to check out what is to come. For the most part though Unstable is usually the same as stable; until they want to push something to stable, which will go through the process I described above. Then it will be same as stable for a while till they want to push another one again.
Some of the updates mentioned in the blog on the forums at their site, are usually stuff that could quite possibly be in the nightly, however no guarentee that branch will work or screw up anything.
Also this makes it so the unstable & nightly have a separate save from the stable so you would have two separate saves. Some might not like this if space is a concern, or the rate at which things could be updated depending on which branch they go with.
I hope that helps to clearify what it is.:)