What are the meaning of each category under WIPE menu in TWRP? I'm new in using TWRP (version 3.0.0-0 to be specific), there are some menu or operation that confuses me.

Under WIPE menu and inside Advanced Options there are many choices to wipe, which are:


Dalvik / ART Cache,
Cache,
System,
Data,
Internal Storage,
MicroSD,
USB OTG


Can you explain what are each of those means one by one?

and also can you elaborate one by one the effect of wiping each of those 7 categories, for example IF let say I ONLY wipe Data, THEN it will only delete app data not the app itself nor any music, videos, pictures, downloads.

and also what will Factory Reset do? will it wipe all of those 7 categories? or will it only wipe some of them? if only some of them deleted, which of those 7 categories will be deleted under Factory Reset?

Lastly I notice that under Home > Advanced > Partition SD Card > on MicroSD I saw that the value stated there around ~5000MB while my external SD Card (removable MicroSD) is much more than that, which is 16GB, so it occurred to me that word "MicroSD" inside TWRP is not the same as the physical removable disk (SD Card / MicroSD), am I right? If yes, then what is the meaning of MicroSD inside TWRP?

Thank You.
I am not sure how much more self explanatory this can be...


Dalvik / ART Cache - This is the runtime cache, where executable binaries are stored (after APK files are "optimized"). It is a unique partition of the system
Cache - /cache partition, where temporary data is stored.
These (numbers 1&amp;2) are wiped on any clean or dirty flash of a ROM, or if problems occur in a running system. Wiping these is usually done together and do not effect actual user information or data.  
System - the /system partition, basically the operating system.
This is only wiped when changing ROMs and a clean flash is required, it should never be done on a "stock" system in most cases other than already stated.
Data - the /data partition EXCLUDING /data/media (Internal Storage).
This is how to perform a "factory reset", this will wipe all applications and user data, but not user's file (picture, music, documents, etc). When doing this, both cache and Dalvik/Art cache should be wiped as well.
Internal Storage - This is your /data/media folder, or user files.
If you want a TRUE factory reset, you need to wipe this as well... be aware this will wipe all user file such as pictures, music, documents, and ROM images if you downloaded them there.
MicroSD - self explanatory
USB OTG - An external USB OTG storage device (often a USB stick) - self explanatory


I would suggest reading the TWRP FAQ too.

As far as the partitioning of the MicroSD card, that is for very specific applications or uses, typically stuff like Link2SD or App2SD, where a ext2/3/4 partition is required to use symbolic links to artificially increase the space available on internal storage by moving the actual files to a special partition of the microSD card and using symbolic links to those files on the actual internal storage or data partition. By itself it has little use or meaning for most people except in conjunction with special applications. This is a rarely used feature in modern device and I wouldn't be surprised if it is depreciated in future versions of TWRP. 

Basically, if you don't know what you are doing in TWRP, don't do it. It does have the potential to damage your device, sometimes irreparably.