Then how do they differ?

It's all in how they are perceived. If you look at something for it's designed purpose it's just that object.. .but if you look at it in terms of the shape, and form it can be an object of art like a vase for holding flowers...on the one side it's just a vessel to hold water and the flowers, but if you look at it aesthetically, you will perhaps appreciate the graceful curves or textures or shape.

I dont think they differ at all.
Industrial design is an art degree if you want to get technical about it.
So everything is art based, maybe not the most creative but at some point it was a vision.

I think of a cup displaying art on it if it's the kind of cup with layers of clear plastic that you slide a picture in...I've also seen 'decorative' cups that are very artistically done.
As for this drawing....superb art! =)

Art is completely open to one's interpretation.

Well, I'm basically talking about Duchamp's Fountain or Warhol's Brillo Boxes. They demonstrate that, to a certain degree, anything can be "art" if you simply call it so (but that doesn't make them good or bad, just art).
So what in the way one sees them makes them different?

In the case of Warhol or Duchamp it's purely context. The idea and the thought process is the art, rather than the object itself.

He's very cute! He looks like a Native American boy.......very nice draw!! :)

Darling and very cute innocent look.....the love of a childs expression. Nice artwork!

lol thanks

And Pam, I know that the concept behind it is the art, but why? Of all things, why art?

Because it was presented in an art gallery, because someone decided to call it art.

I think some artists were testing the limits, wanted to see how far audience will believe it's art when they name it art. Others discovered it's easier than producing art themselves.

But that's just me, I never attempted in 'getting' all that new art.