What's the difference between pasting with middle mouse button, and Shift+Ins?

SHIFT+INS pastes the content of the clipboard, as you can see here. It is the same as CTRL+V (with the difference CTRL+V doesn't work for example in graphic terminals, there you have to use SHIFT+INS or the middle-mouse-click-trick).

When you select a piece of text, it will be loaded to an entirely other buffer than the buffer aforementioned (it is another clipboard, respectively), and you can use it with the middle mouse button, even without Xorg, in tty!

Ryran wrote: highlight + middle click isn't an xorg thing. Many distros support it out of the box on virtual consoles (ttys) as well. (e.g., RedHat/Fedora requires a package+service called gpm to be installed & running.) That said, each highlight + middle click clipboard is local to its tty (i.e., you can't highlight and paste between different virt consoles and/or X).

Summarized: in Xorg you have got two different clipboards. One is reachable with the keyboard, the other is with the mouse.