type = PHP file the template will look for the methods.. Here it is Mage_Catalog_Block_Product_Featured.php
name = Name of the block. It should be unique in the page.
as = Alias. Smaller form of name. It should be unique in it's parent block.
template = The template file (View) this block is attached to. You can call methods from block type inside this by using $this
.. e.g. $this->getName()
name
vs. as
example:
<reference name="left">
<block type="block/type1" name="first_block" template="template1.phtml">
<block type="abc/abc" name="abc" as="common" template="abc.phtml"/>
</block>
<block type="block/type2" name="second_block" template="template2.phtml">
<block type="xyz/xyz" name="xyz" as="common" template="xyz.phtml"/>
</block>
</reference>
So, you can now call block name abc
from first_block
AND xyz
from second_block
as $this->getChildHtml('common');
, but see both the blocks called will be different as per their calling parent.