In terms of what many vendors call unlimited service, Web Hosting Pad's terms of service indicate that its definition of unlimited is what it calls "incremental." Basically, as you need more capability, it wants to discuss that with you, both to help you get the most out of its services, and to make sure you're using its systems without abusing them.
A VPS runs its own copy of an operating system (OS), and customers may have superuser-level access to that operating system instance, so they can install almost any software that runs on that OS. For many purposes they are functionally equivalent to a dedicated physical server, and being software-defined, are able to be much more easily created and configured. They are priced much lower than an equivalent physical server. However, as they share the underlying physical hardware with other VPSes, performance may be lower, depending on the workload of any other executing virtual machines.