Think of it as an escalation of 4WD abilities.
With the center differential unlocked, you have power going to all 4 wheels, distributed via a center differential (which is akin to AWD). Power is distributed, with some variability, between the front and rear drive shafts so that some, or in some cases all, of the power gets sent to the wheels, or wheel, with the most traction. This is well suited towards moderate conditions (gravel or dirt roads, light snow and mud) and allows for easy transitions between slippery conditions and dry pavement, since the center diff modulates the power delivery and prevents drivetrain binding. In very low traction situations however, and depending on how the center differential is set up, you may only be sending power to one of your 4 wheels.
With the center differential locked, you have the power delivery split 50/50 between the front and rear drive shafts (which is basically traditional 4WD). This setup is better suited towards more rigorous conditions (extreme mud and snow, uneven terrain, steep hill climbs/descents, ect.) since the front and rear drive shafts are essentially locked together and rotate at the same rate, which means there is less opportunity for wheel slip (you're essentially guaranteed that 2 of your 4 wheels will be getting power in low traction situations). This mode is not well suited towards pavement driving since you can have wheels skip and chirp and potentially cause drivetrain binding when making tight turns on a high traction surface.
With the rear differential locked, the two rear axle shafts (and the two wheels attached to them) are locked together and rotate at the same rate, which ensures equal power delivery between the two rear wheels in low traction situations. When the rear diff is locked in combination with a locked center diff, you're essentially guaranteed that you'll have power delivery to 3 of your 4 wheels, regardless of the ground conditions (power is split 50/50 between the front and rear drive shafts via the locked center diff, and that 50% going to the rear is in turn split 50/50 between the two rear wheels via the locked rear diff). This mode is extremely useful for very challenging terrain, especially situations where you have one, or more, wheels coming off the ground. Again, it should not be used on high traction surfaces (like pavement).
There are specific situations where each mode is most useful. Also keep in mind that your 4runner has a transfer case with high and low range gears (the high range being suited towards normal driving speeds, and the low range being suited towards slow-speed crawling). A general rule of thumb is to start with 4wd, center diff unlocked for basic offroad/dirt scenarios. If that mode doesn't work, transition to 4wd, center diff locked. If that mode doesn't work, transition to 4wd, center diff locked, and rear diff locked. You may switch the transfer case between 4WD High and 4WD Low depending on how fast you are moving, but generally the 4WD Low is best suited towards technical, low-speed crawling.
As you get more experience using your 4runner in challenging terrain, you'll get a better idea of which mode is best suited to the terrain you're facing and you'll likely find yourself switching into the appropriate mode ahead of time.
