Potentiometer vs Varistor
A Varistor is a voltage-dependent-resistor. Its resistance depends on the voltage applied to it, and it is a 2-terminal device.
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A Potentiometer is a fixed resistance with a mechanically adjustable wiper which can be moved from one end of the fixed resistance to the other, forming an adjustable voltage divider. It is a 3-terminal device.
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A Rhoestat is not the same thing as a Potentiometer, since a Rheostat is typically considered to be mechanically variable resistor and is a 2-terminal device.
You can use a Potentiometer as a Rheostat by simply ignoring one of its fixed-resistor terminals.
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The application in-circuit of a Varistor vs a Potentiometer is not really comparable as they are completely different devices.