What exactly is the difference between orange and purple gear

Rating is the quality of the item (explained here under item rating)

Equippable items have a rating indicating their general level of quality. This number gives you a rough idea of how powerful the viewed item is compared to other items you’re wearing. To raise the rating, look for certain modification items that can increase these ratings, and attach them to your equipment.

Bound items are a feature implemented in MMORPGs to avoid abuse of twinking.

Bound items are designed to prevent them from being shared with other characters, to avoid easily making overpowered lower level characters. If you have a bound item, it can (generally) be sold to in-game vendors, but it cannot be traded to another player.

Unbound items, however, can be freely traded from player to player, and can be used by players who aren't the ones who initially obtained the item (whether from quest, random drop, or by purchasing it from a vendor), assuming that the player meets all of the other requirements for the item.

Bound and unbound is not random. Quest items are typically bound, as they are the reward for that character completing the quest, and therefore it is expected that that character will be the one to use it. The same applies for specific reward drops from difficult encounters, such as raid or group instances.