What does the word Distribution mean? and how are they taxed?

You are looking at two different things two different ways

(a) how is the profit of the business entity (C-Corp, S-Corp, Partnership) taxed?
(b) What is the treatment of distributions from the entity and how, if at all, are they taxed?

(1) Distributions from any form of corporation are legally dividends unless the stockholder is liquidating his interest, in which case they are the proceeds of a sale of the interest. Because a corporation is a separate legal entity from its owners distributions always take place at FMV.
(2) A partnership has no separate legal status and so distributions from a partnership are merely a reallocation of the owner’s share of assets from his business pocket to his personal pockets. They therefore take place at the tax value of the assets, since a person cannot make a profit by trading with himself.

Profits that a C-Corp makes are taxed at the c-Corp level. It pays taxes as it makes the profits. The stockholders do not pay any taxes until they receive money from the corporation.
Profits that a Partnership makes are not taxed at the partnership level they are passed through to the partners. The partners pay tax on their share of the profits even if they have not received any cash from the partnership.
An S-Corporation is a hybrid. It is a corporation for legal purposes but it, and its shareholders are taxed as if it were a partnership.