Back in the days of 7.1.x and earlier, Window Designer was the only tool available for creating and editing windows. Since then, Window Manager was brought in, which is much more powerful, and now the windows created from it are used in Console, instead of those created in Window Designer.
Window Designer was left in so that windows can be created for Mobile Portal. Further to that, Window Designer does have one extra feature, which is that windows created in it can be migrated to Window Manager. This was mainly intended for customers who were upgrading, so they didn't have to recreate all their windows, but it can also be used if a window has been accidentally created in Window Designer.
On the whole, when it comes to creating and editing windows, Window Manager is the tool to use.