SCCM - Difference between device collection, update group and deployment package?

Hey everyone,

I've been setting up our SCCM 2012 environment here for server patching and am just trying to wrap my head around a few concepts.  As I understand it:

-device collections are collections of servers
-software update groups are comprised of multiple device collections and their accompanying updates
-deployment packages are what actually sends the aforementioned updates to the distribution point

Is all of that correct?  Even if so, it's still a little hazy, but these are the three things that have really been bugging me.

Thanks in advance