What is a locked hard drive, and how does it relate to encryption?
A locked hard drive is a hard drive that is encrypted.

When you unlock the drive you are telling the system how to interpret the encrypted data. Unlike permanent decrypting, the data on the drive stays encrypted, you are just telling it how to read the encrypted data on the fly.

On its normal computer information will have been saved into the system's keychain allowing it to access the drive without prompting you for a code. If you open Keychain Access on that Mac and search for the name of the drive, or sort the list by "Kind", you should find an "encrypted volume password" entry. That is what the Mac is using to unlock the drive without prompting you.