Peaches and nectarines are kissing cousins. In fact, maybe closer. Plant a bunch of peach pits and a few of them will actually sprout nectarine trees, and vice versa. It used to be said that the difference was that peaches had fuzz while nectarines didn't. But in supermarkets today, that's hard to determine since many of the peaches have been mechanically de-fuzzed. Generally, the flavor of nectarines is lighter and a little more acidic, almost lemony, while peaches are richer and muskier. Ripe nectarines can make you gasp with pleasure, but a great, perfectly ripe peach will make you fall to your knees. Still, you can use them interchangeably. What's good for the peach is good for the nectarine.
How to choose: Check the background color. Ripe fruit will be golden, not green. Mature fruit that hung on the tree long enough to develop full sugar will have a distinctive orange cast. Always with peaches and nectarines, trust your nose: fruit that is ripe and delicious will smell that way.
How to store: If you buy fruit that is too firm (and maybe you should the way produce is manhandled in farmers markets and supermarkets), leave it at room temperature and it will continue to ripen. Only after it has ripened should you move it to the refrigerator. Chilling under-ripe fruit is about the worst thing you can do.
How to prepare: Peaches need to be peeled because their skins will come loose during cooking. Score a shallow "X" in the bottom of the fruit and dip it in boiling water until the peel starts to pull away. Transfer it immediately to an ice water bath to stop the cooking and peel by hand.