I hopped on a bike for the first time in AGES yesterday and biked to my buddies house, I found a pace that I could sustain nonstop that shocked me. It was amazing.
Biking is awesome, it's also much lower-impact on the body as compared to running...plus it's easier to carry water, food, long-sleeved shirt, cell phone, etc. I love to ride my mountain bike through the local fire-roads...amazing cardio, just awesome!
Back to subject....
Let's ignore the obvious benefits that exercise offers.....ya know, respiratory, circulatory, etc....we all know and agree about that.
Okay...so what's the difference between eating 500 less calories vs. exercising 500 calories off your body. Shooting from the hip, I'm gonna say "not much"....it would seem like a wash, at least on a single instance basis. But who cares about a single instance.
So let's consider a more long-term situation, like a month. So what if we exercise 500-calories per day vs. eating 500 calories less per day.....over the course of one month.
When you eat less on a regular basis it'll sorta give your body the idea that there's less food available...so this will tend to suppress/reduce your metabolism, maybe shed some lean muscle, etc.
On the flip-side, a 500 calorie workout will burn those 500 calories...but when you place a regular demand on your body to generate energy, your cells respond by creating more mitochondria which are the powerhouse's that help create more energy: the amount of mitrochondria sorta IS your metabolism (or so my research and reading have suggested).
So the answer is simple: one reduces your metabolism, lean muscle and likely adjust things to that your body only feels about a 250 calorie deficit.
The other obviously increases your metabolism and tends to build more muscle...quite the opposite of just eating less. Over time you're body will adapt and become more efficeint at doing that exercise...so it'll take longer, but in this static example we're just presuming you'll exercise to a fixed amount of caloric burn.
So this is what happens over the course of one month...it puts you on different roads. What happens with a single instance, it's more like just a step towards either road...it doesn't set anything in stone, but it rather dictates a direction.