What does "Add to Library" and "Remove from Library" mean in Podcasts?

They're just podcasts. Episodes should be either downloaded or not downloaded, and podcasts should be either subscribed to not subscribed. But it seems an episode can be "in your library" without being downloaded, and a podcast can be "in your library" without being subscribed. What does that even mean?

(I'm referring to Podcasts on both Mac OS and iOS.)

If you stop listening to a show for a while, Apple Podcasts might pause your subscription. The shows and downloaded episodes stay in your library, but new episodes might not be updated. To continue getting new episodes, subscribe again.

and

New episodes won't download to your device, but episodes that are already in your library won’t be deleted.

https://support.apple.com/en-in/HT201859#more

To me, this looks like a sweet spot with a collection of all relevant material, since you can search in your library separately(not globally) and it is synced across devices.

Also, not verified, but autoplay might be using library too.

I believe it acts as merely a 'tag' so that when you are in your 'Library' they are collated in a single place. Episodes that are 'added to the library' aren't necessarily downloaded, but are located in a supposedly easy to reach, single location - 'The Library'. It is confusing and I personally never use My Library - going straight to the podcast depending on what I want to listen to.

If you want 'episodes' recurringly or automatically downloaded, the podcasts (not the episodes) do have to be in your Library first it would seem. Then you are able to apply general rules like 'Download only new episodes' or 'Download all episodes from this subscription from the very first episode' (via the app settings found in the General Settings>Podcasts section).

Not that this justifies the existence of a 'library', and Apple have yet again made simple matter complex. Even after a fair bit of research and in-depth look at their user manuals, which didn't help at all, I have only managed to formulated my own opinion - which was mostly thru trial and error anyway.