It's definitely the latter, but mostly by aesthetic variation not functionality. For example, the original 1.0 version had 4 types of wood - now the game has 10

It's definitely the latter, but mostly by aesthetic variation not functionality. For example, the original 1.0 version had 4 types of wood - now the game has 10 types - but they still all work the same way. This expands to anything made out of wood.