The classic block embeds the old classic editor in your post or page. If you edit a post created with the classic editor and open it in the block editor you will see all the content in a classic block. You can convert a classic block to a series of new blocks if you like. Classic Block – Documentation – WordPress.org

This is a classic block. The text and picture are inside the same block, it shows the classic toolbar inside the block when you are editing the block.

The Classic Block allows you to use the old classic editor in a block post. The toolbar looks exactly like the toolbar in the old editor except the add media button is incorporated into the toolbar itself.

When using the classic block, pressing return starts a new paragraph in the block, not a new paragraph block.