Difference between Envelope & Raw mode is that the Raw signal is normal EMG signal, where on the other hand Envelope signal is is smooth line that connects all peaks of the signal. Please look at the image below.
When we are talking about envelope we are talking about upper envelope in the image.
Why it is important for us:
In some experiments we are controlling devices like motor or led bar according to the "power" of EMG signal. If we use raw EMG signal we have problem because the raw signal is jumping up and down at 500- 1000 Hz, it goes positive and negative etc. Since we don't want to our motor to jump at 1000Hz we use a smooth envelope as a substitute for signal power to control motor.
Also deeper explanation about Envelope signal you can read in the link below: