What is the difference in gum paste and fondant? When would you use the gumpaste for decorating instead of the fondant?
you can roll out gumpaste much thinner than fondant, it has a more elasticity and dries faster.
With gumpaste you can do much more fine work, sugarflowers for example.
Fondant is for covering cakes, and making things that aren't likely to collapse as it is quite soft. You can eat fondant no worries. Gumpaste is easier to work with when modelling, it keeps it's shape better, and as tipsy said you can roll it thin for fine work. It dries very hard, but is NOT good to eat, you might break your teeth. It is certainly edible, but you would'nt want to.
A lot of people use fondant with enough tylose powder in it to make it easier to work with, but not enough to turn it into gumpaste.