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TXT (OCR) is a plain text file produced by reading an image. Optical character recognition looks at the picture, works out which letters the shapes are, and writes them out as characters.
What survives is the text and roughly the order it was read in. What does not survive is everything else: fonts, sizes, colours, columns, tables, pictures and the position of anything on the page. A two-column article comes back as one run of text, and a table loses its columns. That is not a fault of the file — plain text has nowhere to keep those things.
Pick it when you want the words and nothing else: to paste them somewhere, to search them, to count them, or to feed them into another program. When the layout matters, PDF (OCR) keeps the page exactly as it looked and adds the text on top of it; for a table of where each word sits, TSV (OCR) reports position and confidence for every word found.
Accuracy depends on the image. Clean, straight, printed text is read almost perfectly; a skewed photograph, a low-resolution scan or handwriting will contain mistakes, so it is worth reading the result through before relying on it.