Linked products are a way of getting your customers to add more items into their baskets!
Once you have added a product (or are editing an existing one), click on the Linked Products tab on the product page:
Cross-sells are related products that are shown to the customer when they are viewing their basket. These are shown in a 'You may be interested in' section to highlight the related product(s).
This is another way of showing related products similarly to using Product Tags, but those show products from the entire marketplace using keywords, not just from your shop. Here, Cross-sells are products you are specifically listing as being related to each other and are more likely to be added at this stage just before checking out.
To add these, simply start typing the product name into the Cross-sells text area and select them from the list.