This is just a trivial question but what are the differences when naming a website that has these different domains? I notice that most .co/.or follows a 2-letter suffix for the country where it came from.

Country tld are generally registered with that country's agent, which is usually a contracted ICANN registrar, versus a .com/.net/.org that can be registered using most ICANN accredited registrars. In some cases the registration for a country tld may be limited to it's citizens or business's. This allows company's to register domains that may not be available as a .com, but are available as a .com.ar and which may be more appropriate since it targets a specific region. Google, for example, has google.com for the world, but also has google.com.ar with a default language of spanish.

There are however certain countries who do sell to anyone and make big bucks by doing so. I forget the island, but there is a tiny little island somewhere that owns the .tv and they sell to TV companies for lots of cash.

It's an island in the Pacific, called Tuvalu and is apparently close to Fiji. I just had to look it up because I have this geeky love of trivia!

Guess how much their government coffers are swelled by quarterly because of this? A million US dollars!

Guess how large the population is? 11,992. That works out at....let's see, one million four times a year divided by 12, 000 give or take a few is... Hold on, I need to take my shoes off to count this.

$333 annually for every man, woman and child there. Not bad at all, really. Good luck to them, I hope their community sees the benefit of that. You learn something new every day.

well like .co is for countries(shows pages from the specific country) and .com is for whole web....

So does this mean that two websites of the same name but have different domain names will be different? This is besides big companies like Yahoo and Google. For example website.co.ir will be different from website.co.sc? Is my understanding correct?

Yes, .co is country based.