I hope that by now the difference between the mask and the layer image is starting to become clear. If not, you should play around with the example above until it starts to make sense. There are two other areas that seem to cause a lot of confusion that I want to touch on.
The first is the color of the mask display when it is made visible. Take the image above and make the mask visible by checking its box in the channels palette. Now double click the Layer 2 Mask channel.
The layer mask display is not the layer mask itself, but rather a colorized, partially transparent version of the mask. Remember, the mask itself is always black, white and gray, and the level of grayness controls the visibility of the image in that layer. The mask display, on the other hand, lets you visualize the areas that are masked while looking at the image itself. In the above case, the actual black of the mask is displayed as red at 80% opacity. The actual white of the mask is transparent. Thus, the masked vertical shapes appear as orange-yellow from the underlying layer and 80% red from the mask. This color is for your convenience only and does not affect the final image in any way. You can control both the color and opacity of the mask display to suit your needs. 50% red is the PS default, but if you are working, say, on an image of a sunset, the red of the mask display is going to get lost in the colors of the sky.