Both designs actually have water jackets around the cylinder itself for cooling. Some are open all the way around each cylinder, and others have the cylinders attached (siamesed), but that's another thread The difference is the deck itself, as you can see in the pictures. An open deck block has just that, the cylinders only attach to the block at the base which can allow movement/distortion at higher power levels. A closed deck block has the cylinders attached at not only the base, but also at the top (deck) which is much more solid when it comes time to make more power. If I remember correctly, sleeving a Honda block does not close the deck, it replaces the factory sleeved aluminum cylinders with all steel cylinders which resists cracking and flexing much better than the original design.