Remove Tracks - Remove tracks from iTunes library, but the file of tracks still on hard driver, and the occupied space will not be freed.
Remove to Trash - Delete tracks from iTunes library, and move the files to Trash, the hard driver space occupied by files are released. And you can restore those files at any time from trash. This option will save so much space on hard driver.
Delete Tracks - Both the tracks and files are deleted, and spaces occupied by files are freed. This option will save so much space on hard driver.