How do databases work with wordpress?

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Apologies if this seems like a silly question. I have done a lot of research but I’m still a bit confused about how databases work with WordPress.

From what I understand, wordpress websites can be run in two ways:

1. **Local Server (e.g., XAMPP):** You can run a local server setup like XAMPP, and manually connect it to a MySQL database, which is more complicated.
2. **Web Hosting Server Plan (e.g., HostGator):** You can purchase a hosting plan online to streamline the process, which automatically connects your website to a database, simplifying the process for users.

Is my understanding correct and am I missing anything? What would be a better option for making websites for clients?

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