I am just wondering what the pros and cons are for using Collections as well as folders for imagery within AEM.
I currently feel like they are the same thing. Can someone explain the difference, please?
The biggest advantage of using collections is that you can group assets dynamically, say based on search criteria. Such assets don't need to be in a specific folder (static).
These might help  and 
 Managing Collections
 A Comprehensive guide to AEM Collections