what is the actual difference between the two... i am not into flipping the Reason rack around and connecting wires... but i am just curious... what is the actual difference between the two?

I don't know all really. I tried Reason demo and only few i can think of is that

Ableton have 8 macro controls on rack while Reason have 4.
Ableton can host rack inside another rack (you can add them like forever i mean as much as your computer can handle) while in Reason you can't do that. One rack with devices and that's it. Sometimes i like experimenting and this (rack inside rack) is really cool in Ableton.

Ableton have PDC (for audio) so you can stack a lot of plugins in Rack and you will still be "in time" and in sync with everything while Reason lack of PDC so you need to take care of not to add to many effects which introduce delay in signal path in Reason Combinator

No cable madness

Imo Reason's is easier to use and more straight forward than the ones in Live.

i see what you mean!!!

but i like the fact that there is a key range and velocity functions in Live's instrument rack...

Both are in the Combinator, FYI.

i stand corrected!!!

NP!! You have to go into the programmer section.

As far as I can tell (I've gone way deeper with Reason's than Live's) they have many of the same core capabilities aside from Live's knob/button advantage and Reason's CV routing; a lot of the difference is your UI preference. Live's is very tidy/clean - every layer/split is neatly divided in a nice menu. Reason's is messier (aside from the handy Combinator programmer) - while you're editing, you see every device in the Combinator at once, although it's pretty obvious where different layers start and end (ie when you see a new instrument or wherever you put a sub-mixer. I find the latter more inspiring, YMMV.

You should try to get into it though - it really teaches you some good lessons as to how it all works, not just for Reason but for many other things

It really depend on person. I have better view in Live but when i think twice about it i don't have any problem in Reason either. Anyway OP asked for differences.

They are both very flexible and make some complex routing, easy to do.

I love that you can use the CV inputs on Combinators to modulater parameters that don't have their own CV inputs for any device in Reason. It's very cool that you can even drop mixers into Combinators. I do wish you could nest Combinators though.

Live's racks are cool because you can nest racks inside of racks and you can assign the chain parameter to a Macro so that you can do some cool manual crossfades and effect switching without a lot of effort.

Yeah I can agree with that. I know Reason a lot better than I know Live. I am still learning my way around it.

There's a lot of differences already noted, such as PDC, nested Racks in Ableton, more macros, etc.

BUT the biggest difference is this:

+ Ableton's racks allow you can to combine an unlimited number of Reason Devices, Live devices, VST/AU plugins and External harware Synths, samplers and effects.
+ Reason's Combinator allows you to combine an unlimited number of Reason Devices. Full Stop.

ableton racks sometimes crash, but you have more possibilities than PH combinators, due to vst support.
propellerhead combinators never crash and are much more funny to build than ableton racks.

Reason 6.5.1 update has just been issued, apoparenly to address combinators crashing with Re's - now you can have the worst of both worlds, limited choice and crashes

I have Reason 6.5 and Live 8 Suit, personaly I have never got in to combinators (but some fo the prestet stuff sounds good).

Live Racks are uber powerful, I also have M4L, throw that in the mix and it is pretty much unlimited-

RE's in combinator or Racks? Just poicked up FX Etch for $20, throw that in a rack and off you go...Oh, and I can use it in Cubase...and Reaper...and Maschine...