Email is federated (you pick a mail host and can communicate with people on different hosts), while BitTorrent is distributed (users send data to each other without needing a fixed set of servers to mediate).
Technically, decentralisation refers to anything that is not centralised (so both federated and distributed protocols would count) but in modern usage decentralisation refers more to distributed protocols.
Federated has some, perhaps different, individual or organization in charge of each server to which users are able to connect. There may be hundreds of different individuals and companies hosting and controlling different servers. All of which could either choose to communicate with each other, or not. Each of these servers would have, perhaps, millions of users who would then be beholden to the regulatory whims of the individual or organization controlling the server they join. An example would be Mastadon.
In a completely decentralized architecture, every client would also be a server. And every client could, potentially, connect to every other client. So every user is beholden only to himself. Other users would be free, of course, not to connect to that user, but the user could post whatever s/he wanted without fear of being cut off. There is no good example of this architecture out there right now.
Basically with Mastadon, you can be cut off. With a hypothetical completely distributed social network architecture, you can't. (Well, maybe your ISP could cut off your internet connection? But that's a whole other issue.)
> In a completely decentralized architecture, every client would also be a server. [...] There is no good example of this architecture out there right now.
BitTorrent ? Git ? Bitcoin ?
(They can also become centralized if there's a will, see Pirate Bay / Github / MtGox.)
