What's the difference between Defence and Protection?

Defense blocks a certain amount of damage being received by your toon. This dmg hits Protection or health. Protection must be worn thru before health is reduced by an attack (except for ignores Protection skills).
Protection kicks in at gear 9 I think. It can be boosted by gear lvls and mods. Protection stacks from health, so either high health or high protection mods bring good protection. Choice between those is a bit specific to individual toon kits