How do adjustment of status and consular processing differ?

You should consult your attorney who prepared your I-526. Your I-526 says whether you intended to consular process or adjust in the United States, so take a look at your Form I-526 submitted to USCIS. Generally, if you are in the United States in another lawful immigration status, such as a student visa or work visa, and you maintain your status until the I-526 is approved, then you can adjust in the United States and your family will be able to file with you their adjustment of status applications if they are dependents and also maintained lawful status. If you are abroad, then you will consular process your and your family's immigrant visas upon approval of the I-526, and enter the United States as conditional permanent residents and receive your conditional green cards and social security cards in about 30-40 days after admission to the United States on immigrant visas.

It depends on where you are physically located at the time of your approval. If you are in the United States and in legal status you could adjust here. If you are in your own country then you need to process through the consulate.

Usually consular is more practical as you would need to be in the United States in a nonimmigrant status in order to adjust status and will need to remain here until the travel permit arrives. But this is something to discuss with counsel at the time of filing the I-526. You can always select consular and then if in the United States and in status with all of the family, it is easy to file the adjustment (switching from adjustment to consular requires an extra form and you will lose several months.)

If you are in the United States legally when the I-526 is approved under a valid nonimmigrant status, you can file for adjustment of status to permanent residency. If you are in your home country, you go to the U.S. consulate for your EB-5 visa, and then enter the United States as a permanent resident. It depends on your timeline and legal status in the United States.

I-485, Adjustment of Status, is used if you are already legal in the United States under a valid status and you are adjusting that status to a permanent residency. If you are outside of the United States, then you need to go through the immigrant visa application process (DS-260) through consulate processing. Neither is better than another.