Forum Discussion
Standard Release and First Release settings on Admin Portal
Some good info here, it is still a little hazy.
[Edited Response - deleted some]
I think there are two different usages of First Release. The first release for Office seems to be controlled from the individual workstation.
The Admin Panel Setting - First Release vs. Standard seems to be only about Sharepoint Online, Exchange Online, and the other Online products (NOT the installed Office clients)
You are on the right track, the First Release for Office is distinct and just relates to getting early access to upcoming Office features. To expand on this there is:
First Release for Deferred Channel Preview the next version of the Deferred Channel, this gives you a four-month window to test application compatibility, prepare you users for new features etc.
First Release for Current Channel which comes in two flavours Slow and Fast - this is the same update channel as those in the Office Insider program receive. This is the most cutting-edge version of Office, which will see new features earlier than any other version.
Office 365 First Release, as you have said, is separate, it enables early access to Office 365 features, which may include SharePoint Online or Exchange Online, as shown below from earlier in the year:
By selecting users for Office 365 First Release, this will also give them access to First Release for Deferred Channel, if they download Office from the portal. A message will be shown pointing this out on the download page - "Your admin has enabled First Release, so you get early access to the latest Office features".
Selecting users for First Release doesn't reconfigure their existing Office installation, as you say that's controlled elsewhere. As has been pointed out that can be done via the deployment and configuration.xml file or via Group Policy.
Edit, here is a slide that explains FR a bit better though it isn't particularly recent -
From MS Ignore 2015