So, what's the difference between a Lease Option and a Wrap Around Mortgage?

A Lease Option consists of two separate concepts "Leasing" and "Optioning", and is usually set up on separate contracts.
LEASE:
A lease is a contract where the landlord grants possession of the property to the tenant.
OPTION:
An option is contract where the seller grants the right but NOT the obligation to buy the property.

With a Lease Option the parties are subject to the Landlord/Tenant laws in your province/state. This has its pros and cons which you need to understand before embarking on one of these deals.

Wrap Around Mortgages on the other hand are essentially just a promissory note held by the seller of the property. They "wrap around" an existing mortgage (which usually IS held by a bank), hence the name. These contracts are sometimes subject to mortgage laws and sometimes they aren't, you need to know which is the case in your province/state. If they are subject to mortgage laws then you need to understand those laws before you use them in your investing.

In most places the Advantages/Disadvantages of Lease Options are more in the favor of sellers than Wrap Around Mortgages. But it depends on what you want to accomplish. For example, it's common to get more money down and a higher monthly payment on a Wrap than an L/O. This becomes almost a necessity in areas where Wraps fall under mortgage laws that require foreclosure, in order to protect the seller from default on the part of the buyer.

I hope that helps.