I didn't find the distinction in the Wikipedia article, but in the US "public transit" is commonly used to refer to local transit options and "trains" usually refer to intercity travel.
Right, while in the uk with much higher density of towns and train stations, people also use them for local travel to get into town or one town over. The extreme case is something like a million people use trains to commute into London every day, with another million or so on each of bus and Tube (subway).
Some long distance trains you can pay for a private cabin with decent meal service, or just a single seat and access to a vending machine.