What is the difference in investing using CPF IS versus SRS?

The fund sources will differ. Your CPF IS investment will draw from your OA or SA monies, and any liquidation will cause the funds to be re-deposited back to their respective accounts. What you can invest in, will follow guidelines set by CPF board. The availability of investments for CPF OA is far greater than CPF SA, and I take this as an implicit message from CPF board to mean that you really shouldn't invest your SA since it's 4% risk free.

You need the added step of opening a CPF Investment account with a bank to invest your CPF OA monies. This is not needed for SA.

For SRS, you would first need an SRS account first, and then contribute to it, before being able to invest such funds. Note that the list of available investment products for SRS is greater than that of CPF OA or SA. Just want to point out that for OA and SRS, your equity options are limited to the Singapore market.

Any liquidation of SRS investments will cause the proceeds to be returned to the SRS account. Alternatively, when you reach SRS withdrawal age, you are allow you transfer your holdings such as shares, straight to your CDP, this will be considered a withdrawal from your SRS account and you will be taxed accordingly on the market value of your withdrawal. The advantage of this is that you avoid transaction costs by selling and buying back again.

They use different source of fund. CPFIS uses monies in OA and SA while SRS uses money in SRS. You also have different choices and limits on what and how much to and can buy.

Other than that withdrawing from CPFIS puts money back in CPF and you have to follow the rules of CPF. While withdrawing SRS investments puts money back in the SRS accounts which has it's own sets of rules but note that is withdrawable fully anytime before the retirement age with a 5% penalty and 100% taxable upon year of withdrawal or without penalty and 50% taxed after retirement age.