How would embedded quotations be used when quoting from passages/sources within an essay? What would be the difference between normal quotations and embedded quotations?
Simply change the double quotes in the source text into single quotes to indicate that it is an inner quotation. Otherwise there is no difference.
(Note that if you are writing, say, a research paper, you might want to quote the original source of the quote as well in, say, a "works cited" page. That depends on a ton of things though)