Some info I found on "another Z site" (I cannot vouch for it's accuracy, but appears to be how I understand it to work):
Quote:
TCS compares wheel rotation and cut throttle to stop spinning. The more aggressively you spin the tires, the longer it takes for throttle control to return. Lite spins may not even be detected so it is still possible to slide the back end in some cases. When it is turned off, it is off.
VDC includes TCS and adds the yaw sensor and individual wheel braking for corrections. When using the factory switch, VDC only partially turns off, to completely disable it, it is necessary to disconnect power to the yaw sensor.
Also the models with VDC also include BLSD, or brake limited slip differential. Brakes are used to compensate for slipping rear wheels when the VLSD is overpowered or not coming in quick enough. Nissan does not consider this part off the VDC system.
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And here's a GREAT link I found to Nissan's Explanation of what VDC is and how it works:
VDC: What it is and how it works