RO = reverse osmosis RO/DI = reverse osmosis & de-ionized
As to what water to use, you're asking a question that is sure to provoke a lot of strong feelings. You can use tap water and have good results, but, you're at the mercy of your municipality for any kind of consistency in your water parameters. Spring runoff, or whatever, and suddenly you can have sludge in your tank. Using RO or RO/DI gives you a consistent starting point.
As you get into more advanced areas of the hobby you may find that it becomes less of a luxury and more of a necessity to go into RO or RO/DI. But for simpler tanks where maybe all you have is mushrooms and other hardy soft-corals, you might be able to get away with it.
I have found, over time, that the hard water aspect of our water is less useful than you might think. Calcium in the water column is meaningless without a corresponding alkalinity factor. Without trying to get too complicated, think of "alkalinity" as the measure of "the ability to
draw calcium out of the water". So if you have high calcium but zero alkalinity, it's useless because nobody can use the calcium for themselves, it's sitting in the water column basically inert. Managing your alkalinity is something that requires effort (i.e., it won't happen on its own). You can maybe manage it with water changes, buffers, kalkwasser, or the pinnacle is a calcium reactor. Don't worry if this sounds all over your head for now, it takes a while of reading before it all starts to make sense.
PS. In answer to your question, I use RO. One day I'll switch into RO/DI but for now it's just RO for me.