What do you mean about explaining the differences between E, Em and say E5 or E7?
Really just basic stuff, explaing that this is the Em, when I put my finger here it is a E. That is cause I changed one single note, which happens to the third, the chord defining one.
The lowest string is the chord base note if not marked otherwise. A chord is made up of three notes minimum. You might now say why is the D string not the third, it is the third string played. Yes but it is just an octave of the base note here (you can show octave shift style playing from this later).
Also easy to go to barree chords from there.
If you apply that knowledge that the third is defining for chords and that sometimes you encounter things like octaves you can basecally any chord and find the opposite version, be it minor or major.
Same idea with the 7th, explain what it is and perhaps where to find it and the student can find them himself naturally and does not really have to keep it as an extra chords, just as a variation.
To me this is still simple stuff but gives you so much in the way of understanding. The chords is no longer just some figure for which you gotta look up each and every variation. Show someone who knows things like that a A chords and he basecally already knows all variations and with a barree even more.
Now that is valuable in my book.