When to use one or another?
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A static mesh is stationary and cannot be manipulated in-game. A prop can be used for all sorts of things. For example a prop can be copied and placed within the games’ editor, or you can make it a destructible.
In Unreal Editor for Fortnite (UEFN), both “building prop” and “building static mesh” refer to different types of objects you can place within your game world, each with unique characteristics and uses.
A building prop is a mesh Actor whose parameters aren’t exposed to the user in Creative. This means you can’t alter its behavior, but you can modify its size (scale), location (coordinates), or rotation (axis). Props are primarily used to make the environment more visually interesting. An example of a Prop would be a PreFab Building.
On the other hand, a building static mesh, or Static Mesh, is a 3D object without animations, drawn within a level. It can have a transform modification that applies to the whole object. Static Meshes are 3D models created in external applications (such as 3dsMax, Maya, or Blender) and imported into Unreal Editor through the Content Browser. They form the basic unit for creating world geometry for levels in Unreal Engine and can be more complex than other types of geometry due to being cached in video memory.
The key difference lies in their flexibility and functionality: props are easier to manipulate but offer limited customization options, whereas static meshes can be more intricate and versatile but may require more resources.
It’s also worth noting that you have the option of converting your asset into a prop. This lets you dictate how your asset interacts with player characters, devices, other props, and the phone tool in Fortnite Creative, including handling gameplay elements like damage and destruction, and choosing the resource type dropped when the asset is destroyed.
Here is a great guide that shows you how to create your asset into props:
https://dev.epicgames.com/documentation/en-us/uefn/converting-assets-into-props-in-unreal-editor-for-fortnite
Hope that helps 
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@DRAGONSTUDIO but how do make building static mesh work with player builds like fortnite walls & floors do?
ive literally spent ALL DAY testing every single setting to see what they all do and NOTHING got the desired outcome! so i can get player builds to connect to building SMactors but not break on edit. Or i can get player builds to not connect at all, but im convinced epic is hiding some backend setting that says “break attachment on edit” because nothing else is making sense/working… 
so disappointed right now. stressful long day.
made an entire level around custom assests/meshes due to the problem of custom materials/textures not always sticking to baked fortnite assets and this is what i get 
Sorry to hear you are experiencing this. Have you tried taking your meshes and making them into BPP, Blue Print Props.
Here is a quick step by step on how to create a BPP
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hi thanks for responding back! yes i did, that was the last step i tried last night instead of a building blueprint. i even tried the logical way of let me copy the master developers here (fortnite/epic) and opened up a details panel of one of their walls & floors, yet even with the exact same settings it doesnt act exactly the same. Like my blueprint wall wont even show that my player built floors can connect to it. I have to toggle the setting “structurally support overlapping actors” in order to get them to place, but then try editing them… they dont break on edit like they were designed to, like would make sense. Its just so frustrating.
Hey, did you figure out a way to build on top of the Mesh?