Reverb is an effect created by feeding the output back into the input after a short delay. It can be used to simulate a larger space and has the effect of sounding like echos or extending the tail end of a sound.
Re-EQ is a THX post processing mode that applies equalization to the sound to tame the highs. It is usually described as a method of reducing the high frequencies for a smaller room because movies are mixed for a much larger space. Onkyo has their own proprietary version that they call CineFilter. Use it if you like the change in sound; otherwise not. I never notice any difference with it so just leave it off.
