Foam blocks suit waxes and sealants. Microfibre applicators suit dressings and trim products. Dedicated coating blocks with a suede cloth are for ceramic coatings. Matching them keeps product where you want it.
Wash and reuse the ones you use for wax, dressing and sealant. Keep a separate set for interior and exterior so you never drag a trim dressing across your paint.
Foam lays product down thin and even, which suits protection. Microfibre grabs and spreads thicker liquids like dressings. Neither is better overall, they just do different jobs.