[apinkel]

Sense is the next progression of Touch Flo.

HTC formally called their Windows Mobile UI overlay Touch Flow (Touch Flow 2D, Touch Flo 3D, Touch Flow 3D version 2.1, etc.) they re-branded this UI overlay from Touch Flow to Sense... I believe this was done as a way to re-use the same touch flo interface on Android but to give it a new name so the android owners didn't turn up their noses due to it's association with windows mobile.

On the Diamond you'll typically see:
TF3D - Stock UI
TF3D 2.1 - I don't remember all the changes but a few notable ones for me was the ability to re-configure the tabs and a much improved calendar.
Sense 2.1 - Adds weather animation to home screen, agenda view to the calendar and a more usable email tab
Sense 2.5 - Adds quick links to home screen and a number of other tweaks I don't remember.

I prefer Sense 2.1 due to it's combination of performance and functionality.