Bots are straightforward:

Storage is storage. This is where the bots put things you deconstruct and where the bots grab things to build.

Requestor chests use bots to attempt to always have the amount(s) you set in them at all times.

Active providers attempt to be empty all the time. Logistics bots will move items out of these chests into storage.

Passive providers are like active providers but don't need to be empty all the time. Bots will take out of a passive provider before storage (even if storage is closer to the destination)

Buffer chests are weird. I don't fully understand them but i believe they're basically normal chests until you get over X amount in them then they turn into active providers? You can set an option on requester chests to request from buffers and then i believe that it then ignores whatever buffer settings you have... I never use them...

An important nuance is that the network will try to keep the same item in the same chest so if you have wood in a storage chest in the north bots will fly PAST empty storage to go to that specific chest that already has wood in it. Also bots will never put items back in a provider and will never take out of a requestor even if the items inside are no longer requested by the chest.

Basically throw down a lot of storage chests in one place. Put passive providers as the output for stuff you build. Put requestor chests as input for assemblers (if you copy an assembler with a recipe you can paste it onto a requestor to automatically request the ingredients). Do not put gears in your network it's just easier to move iron around and make gears where you need it.