Apparently you’re not accustomed to WordPress’ structure, so lets take this from the beginning…
Posts, pages, presentation page
WordPress allows you to display various… let’s call them areas, or sections.
In a particular area/section, you can display 1 ‘page‘, 1 ‘posts‘ or ‘a lists of posts‘ – a category (or archive). The pages and posts are the content you write/edit.
Also, the menu items (created automatically by WordPress or manually added by you) link to these areas/sections.
What users see when they get to your http://mydomain/ site is the ‘homepage‘. That’s just a particular area/section. WordPress lets you configure this to display either a ‘list of posts‘ (the default) or a ‘page‘ by using the Frontpage option in the Settings > Reading section.
The theme adds one more (invisible) feature here, allowing the display of the ‘presentation page‘ (not actually a ‘page‘ in the WordPress sense but a special theme area/section).
As plain obvious as this sounds – you can only set one of these to be the ‘homepage‘ at one time. Your users will only see one ‘homepage‘, what you configured it to be: the ‘list of posts‘, the ‘page‘, or the theme’s ‘presentation page‘. Note however that the theme’s presentation page will only replace the list of posts homepage when enable and never a static page.
If you set the theme to display the ‘presentation page‘ on the ‘homepage‘, obviously, the ‘list of posts‘ will not be visible anymore, but the presentation page itself includes a list of posts below its dedicated custom content (which can be turned on/off in the theme settings).
If you don’t want to display posts on the homepage at all but want them in another section, the theme takes care of this by providing another feature (described in the C17 question) with which you can create a ‘page‘ (note the term) which will ‘list posts‘. This is not the actual ‘list of posts‘ used by WordPress on its default homepage but rather a replacement provided by the theme.
Arranging the menu items
Now, to get to all these ‘pages‘, ‘posts‘ or ‘homepage‘ a visitor (or you) would need to know the actual links… and this would be crazy.
This is where ‘custom menus‘ come in. WordPress will automatically list all your ‘pages‘ in its main menu by default. But at many times this is not preferred or desired.
Using a custom menu you can add whichever ‘items‘ (buttons/links/elements) you want in your menu, each of those ‘items‘ linking to one area/section (‘page‘, ‘post‘, category or some other form of content) or external URL.
Now, as a custom case scenario, you’d probably want one an ‘item‘ (button/link/element) to point to your ‘homepage‘ (which in this particular case is set to be the ‘presentation page‘), one to point to your ‘lists of posts‘ custom ‘page‘, and perhaps others to link to other ‘pages‘.
And depending on what content you add to your ‘presentation page‘, the ‘homepage‘ will also point to various ‘post‘s and ‘page‘s around the site… (or none at all)
Best way for you to get accustomed to all this is to first use WordPress’ built-in functionality (and leave the presentation page disabled). Once you learn how various changes/edits you make in the backend affect your visible site, you can move up to using the theme’s more powerful options.