Mods are a collection of pre-modified game files. You need JSGME for "enabling" them. You could as well overwrite stock files with modded ones directly, but then you would be forced to re-install the game for restoring vanilla files, whereas using JSGME you are allowed to simply disable the enabled mods with few mouse clicks.
The patcher is an utility needed for patching the game with TDW's patches. Those patches, included within the same package as the patcher, affect several game features hardcoded within SH5's executable, DLL and ACT files. Likewise JSGME, the patcher is designed for letting you to enable/disable stuff, but it obviously can't handle mods; it only deals with the patches designed by TDW.
You can use most mods and patches at the same time.
