I have been using unix on and off for a number of years. I am not a sys admin. I use what I need. I have googled this, but I really can't figure out what is the difference between using xarg and just using a regular pipe? Why do I need to include xarg sometimes and how do I know when I need it?

You would use xargs when you get an errror message like "too many arguments", or when you want on the same line the output of more than one command, look :

ant:/home/vbe $ date pwd 
date: bad conversion
ant:/home/vbe $ date;pwd
Fri May  4 16:32:42 METDST 2012
/home/vbe
ant:/home/vbe $ (date;pwd)|xargs
Fri May 4 16:33:04 METDST 2012 /home/vbe
ant:/home/vbe $

pipes connect output of one command to input of another.

xargs is used to build commands. so if a command needs argument passed instead of input on stdin you use xargs... the default command is echo (vbe's example). it breaks spaces and newlines and i avoid it for this reason when working with files.

$ printf '%s\n' file1 file2 file3 | xargs touch
$ ls file?
file1  file2  file3