"what is the difference between a vertical raised panel bit and a horizontal raised panel bit"
The vertical bit ,is just that the cutters are vertical for the most part and the horizontal are just that.(parallel to the top)
Real the link below and you will see a snapshot of the two types of bits in the links. http://www.routerforums.com/showthre...?threadid=2854
With the vertical bit it takes less HP to make a panel,most 2HP can make panels some time less HP will do it also.
Now when it comes to horizontal bits ,it's true you should use a 3HP router or bigger but you can use a 2HP but it takes more cuts and more time, and every time you run the panel by the bit you take a chance of nailing the panel with a nick or low spot.
Plus the speed of the bit must come down because you are spining a big bit that will scare the hell out of you,a speed control is a must on horizontal bits.(over 200MPH)
Most of the big routers come with them.
They do make vertical router tables or you can add one to your horizontal router table.
The router is mounted on the back side of your router table (the norm) or you can add it to the side and the bit is horizontal to the table top.(parallel)
If you do a search on the forum you will find one or two of them posted.
I think del s. or Ed posted a snapshot of his if I recall.
see the link at the bottom for a snapshot of a Horizontal router Table-,they call it Horizontal .
I made one for my router table but didn't use it that much so I took it off,they are easy to make with a router base plate like Oak-Parks type and screw it to the router base and make it so it can move up or down behind the router table with pocket hole for the bit so it can drop into the table top.
They are great for many jobs like putting in mortise slots,vertical bits and alike.
Hope this helps
More snapshots below, and some new ones for me also. http://cgi.ebay.com/WOODHAVEN-HORIZO...ayphotohosting http://cgi.ebay.com/WOODHAVEN-HORIZO...QQcmdZViewItem http://www.woodhaven.com/detail.aspx?ID=1252