You should never fly in Rate mode. The difference between the two is rate mode, the gyro will stop the tail movement and that is it. Lets say your helicopter is facing 230º. A gust of wind hits the tail and blows it to 215º. The gyro will sense the movement and stop the tail at 215º and hold it there. At this point, the gyro has completed it's correction and your heli is left 15º from where it was.
In Heading Hold mode, again lets say you are at 230º and the same gust of wind hits your helicopter and again moves it to 215º. The gyro again will sense this, stop the tail movement, AND THEN move the tail back to a heading of 230º. Hence the name "Heading Hold".
In all reality, you should hover or fly your helicopter (what ever you are comfortable with at the time) and you should set the tail gain as high as you can. YOu do this by raising the gain until you get a slight tail wag, then backing it down 5%.
Also, make sure you have a green status light on your 3GX. This indicates HH mode. In you Tx in the gyro menu, your channel should be Aux2 and in all honesty, if you are not doing smack 3D, set your switch to "Gyro" and only fly with one setting. I have my settings at 37% (this is for my gyro, yours will be different) which is on position 0. Position 1 is -35% and position 2 is 0%. I do this so that I cna fly in 0 with heading hold, but before I take off, I cna flip the switch into 1 and center the tail blades so the helicopter doesn't want to spin on the ground while spooling up. Position 2 with a setting of 0% is there so that I can make the tail act like there is not a gyro on it. I rarely use this.
I hope this helps you out.
