Legal custody means the parents retain their rights to the children, meaning you don't get to make all the decisions for the children, custody is also reversable, adoption is final you have all rights as the childrens parents and you therefore get to make all the decisions regarding the children
This is my understanding as well. My parents were given "permanant" legal guardianship of my youngest brother and sister many many years ago. However, it was still an issue when they wanted to move (due to a job transfer) and a few other times. Each time my parents had to hire their own attorney and pay the big bucks, while bdad could argue and make any "stipulations/demands" that he wanted. There was also a screw up in the paperwork that prevented them from "adopting" my sibs without their father voluntarily terminating his rights (which he was unwilling to do), even though the judge said he had no chance of having the children returned to him. It really was quite a mess for the entire 16 years that they have had custody (until bdad died). If at all possible I would try to have the bparents volunarily terminate their rights and move straight for adoption (skipping the legal guardian thing- if possible).