The Selected Entries folder contains folders for each of the following types of geometry entities currently selected in the viewport:
Points
Vertices
Curves
Edges (Surface and Solid)
Surfaces
Faces
Solids
Co-ordinate Systems
Entities can be added by clicking (or Ctrl-Clicking for multiples) on them.
The lower window contains the Selected Entity folder. This folder is populated whenever your selection is ambiguous – for instance when two entities are very close together. The possible selections will be displayed and you can select the intended entity by double clicking it.
Note: Many operations can be accomplished by using the right mouse button menus.