1U, 2U, 4U tell you the height of the case. Look at some of the pics on the website I mentioned to get an idea.
If you are building rackmount servers out of standard ATX PCs, I would recommend 4U. They may be larger, but they also don't require any speical power supplies or PCI converters. Normal PC components will generally be too tall for a 2 or 1U case.