does it simply mean that it validates all the transactions on the blockchain for internal use only?
does that mean it acts like a validator node on the network while active?
Does the distinction make sense? If I leave Daedalus running on my laptop will it do meaningful work for the network?
The description you are referring to:
Daedalus is a full node wallet. This means that unlike light wallets
(e.g.Yoroi, Adalite etc.) Daedalus downloads a full copy of the
Cardano blockchain and independently validates every transaction in
its history. That way you get maximum security and completely
trustless operation, without centrally hosted 3rd party servers.
only means that Daedalus holds a full copy of the ledger which means the wallet can validate every single block from the past. There is no pruning as you would have with lightweight wallets.
However, Daedauls runs
cardano-node in wallet-mode/passive mode, meaning it cannot verify new transactions coming to the network - only producer nodes do that. They can extend the blockchain.