AF-S/C/A - HOW to focus. AF-S - Focus just once. AF-C - Focus continuously. AF-A - Starts as AF-S and if the distance to subject changes, switches to AF-C.
AF-Area - WHERE to focus. Single Point - Focus at the selected focus point only. Dynamic - Start at the selected focus point. When a subject is identified, keep focus on the subject even if the subject moves to surrounding focus points. Exposure is always based on the original selected focus point only. 3D-Tracking - Start at the selected focus point. When a subject is identified, keep focus on the subject even if the subject moves to surrounding focus points. When the subject moves, the new focus point becomes the "selected" focus point. Exposure is based on the new focus point. Auto - the camera selects the focus point.
With AF-S, all AF-Area modes act like the Single Point AF-Area. In fact, on the D7000 I don't think you can even select any other AF-Area.
In AF-A mode, the SB-600 will not provide AF-Assist for continued focusing if the camera switches to AF-C. As I had stated above, in AF-A mode, my D90 wouldn't even switch to AF-C mode when the SB-600 is mounted. I don't know if that is true with a D7000. In any case, AF-Assist never works with AF-C (whether it's AF-C mode or AF-A in AF-C mode.)
If you want to maintain focus with AF-Assist then you cannot use AF-C. You should use AF-S and "drum" the shutter (continuously half-pressing and releasing the shutter.) When you want to take the picture, press the shutter fully...don't stop at the half-press, as there's no need (however, make sure that your custom setting "a2:AF-S Priority" is set to "Focus"...you want the camera to fire after it has achieved a focus lock.)
This will also place red lights from the SB-600 on the subject every time you half-press.
Yes, in 3D Tracking the focus point actually moves with the subject. In Dynamic the focus point does not move. The focus points that surround the selected focus point are simply assisting in maintaining focus. The expectation is that you really do want the subject under that one selected focus point. With 3D Tracking, the expectation is that the subject can be anywhere, and so the focus point follows. The difference is composition. Use Dynamic when your composition is fixed and the subject needs to be in the correct spot. Use 3D Tracking when the composition is fluid. 3D Tracking with AF-C is also good for the "focus & recompose" method of composing images. You focus on something in the center of the image, and then recompose. As you recompose, the object you focused on will be tracked, and will be kept in focus. This is necessary when using 35-50mm lenses at large apertures, as the change in composition may blur the object you focused on.