The key difference comes down to your current situation in Australia and your work history with your sponsoring employer.
The TRT stream is for people already working in Australia on a 482 visa who have been with an approved sponsoring employer or employers for at least two years. It does not require a skills assessment, which makes it a simpler process for many applicants. The trade-off is that you must have worked in Australia for at least two years (excluding unpaid leaves).
The Direct Entry stream is for people who either have not held a 482 or 457 visa, or have not yet built up the required work history with their employer. It requires a positive skills assessment and at least three years of relevant experience, competent English; all at the time of application; but it opens the permanent residency pathway to a broader range of applicants.
In reality, direct entry is a faster route to permanent residency, but employers usually want to test the employee out (on a skills in demand 482 visa) before committing to sponsoring them for 186 permanent visa, or getting a positive skills assessment may be a hurdle preventing our clients from applying under the direct entry stream.