Everything you ever wanted to know about the PCMCIA card standards... check out:
http://www.pcmcia.org/pccard.htm
Here's 3 pics demonstrating the difference.
http://www.pcmcia.org/images/Type_I.jpg
http://www.pcmcia.org/images/Type_II.jpg
http://www.pcmcia.org/images/Type_III.jpg
Included is the following:
"The PC Card Standard provides physical specifications for three types of PC Cards, with additional provisions for extended cards. All three card types measure the same length and width and use the same 68-pin connector. The only difference between the card types is thickness. The thicknesses are 3.3, 5.0, and 10.5 millimeters for Type I, Type II, and Type III cards respectively. Because they differ only in thickness, a thinner card can be used in a thicker slot, but a thicker card can not be used in a thinner slot.
The card types each have features that fit the needs of different applications. Type I PC Cards are typically used for memory devices such as RAM, Flash, OTP, and SRAM cards. Type II PC Cards are typically used for I/O devices such as data/fax modems, LANs, and mass storage devices. Type III PC Cards are used for devices whose components are thicker, such as rotating mass storage devices. Extended cards allow the addition of components that must remain outside the system for proper operation, such as antennas for wireless applications.
The release number refers to the version of the PC Card Standard that a particular card or system was based on. Basically, release 1.0 supported memory only, and 2.X releases supported memory and I/O applications. "