Hi Rama
Here is the answer:
there are two different things at play here
1) for managed services customers only, AEM 6.1+ customers get a free and very light version of Adobe Target to use for rules based personalization WITHOUT metrics or segments, if they don't own Adobe Target already. This uses the AEM targeting workflow w/ Target as the engine and is supposed to be a teaser to encourage adoption of Target. No Target UI access is given, and no advanced features are allowed.
2) when picking the targeting engine, you can use AEM or Target. The AEM engine also doesn't have metrics or segments that I am aware of, and is not connected to Marketing Cloud ID which means no shared audiences, no A4T, no customer attributes, etc. It will let you use Context Hub/Client Context
My suggestion is that if a user has Target, they will never need to use the built in AEM targeting. This is, in some ways, a legacy feature from before the time where the two products were as integrated as deeply as they are today
Lastly, a customer should never do "personalization" without validation and experimentation (aka optimization) - which is why metrics and segments are crucial to doing personalization.
I hope this would help you.
~kautuk