A drawing template is a blank drawing document (.drwdot) that is used to start a new Solidworks Drawing (.slddrw). You can have several, for different situations, clients, etc. It can, and usually does, contain a sheet format.
A sheet format (.slddrt) is the layout of a drawing sheet, and controls the title block (or at least it should), sheet orientation (landscape or portrait), border lines, and table anchor points.
Now I'll elaborate on them.
As I said above, sheet formats contain the title block and its notes, along with a few other things. To edit a sheet format, right-click on a blank part of the drawing sheet or the sheet name in the tree and choose "Edit Sheet Format" from the drop-down.
When you finish your edits exit the sheet format function. If this is a one-time edit that's all you need to do. If you want to save this for future use then go to File > Save sheet format... Save it at the location you're pointing to at Tools > Options > System Options > File Locations > Sheet formats. I'd suggest not saving them in the default location, but somewhere away from the Solidworks installation folders so they won't get lost when you upgrade to a new version of the software.
If you've made this edit on a multiple sheet drawing, only the active sheet will reflect the change. You can go to Sheet Properties and select the Reload button for the other sheets to update them. This doesn't always work, so if it doesn't update right away try a Ctrl+Q rebuild. If it still doesn't work, go back to Sheet Properties, select a different sheet format, select "Apply Changes", then repeat the process but select the original format. That should bring in the updated version.
Speaking of editing the sheet format, this isn't something you should be doing often. It's best to have any variable notes in the title block like project name/number, date, etc linked to custom properties. If you don't know how to do this yet feel free to ask below in a Reply and I'll be happy to explain. I go months without ever editing my sheet formats.
You can have multiple sheet formats saved for different situations. To access your sheet formats go to the same drop-down shown above, but choose "Properties" instead. That will bring up the table shown below.
Now for more on drawing templates. When you get a drawing set up the way you want it, with the desired sheet format and settings at Tools > Options > Document Properties, but without any drawing views, do a "Save as" and select Drawing Template from the file type drop-down. Again, save it at a location other than the default so you won't lose it when you upgrade to a new version of the software. If you're in an organization with multiple users it would be a good idea to save these files on a server so the other users will be able to access them, and to keep the drawings from your organization uniform.
As I said above, a drawing template will usually contain a sheet format, but if you don't want it to then open a new Drawing, right-click on the sheet format in the tree, and select "Delete" from the drop-down. Save this Drawing Template with the method explained above. After doing this, when starting a new Drawing using this template you'll be prompted to choose a sheet format.
Now for the part that gets a lot of people. When a Drawing template is saved, whatever sheet format it contains at the time is how it's saved. Drawing templates don't maintain a link to the sheet format, so if you've edited a sheet format and saved it, and then open a new Drawing using this sheet format, the changes you made won't be in this new document. You'll need to Reload the sheet format (see Sheet Properties screenshot above). After doing that be sure to save your Drawing template so you won't need to reload the sheet format in the future.
The same is true for existing Drawing documents. If you open an old Drawing that contains a sheet format that's been edited you'll need to Reload the sheet format to update it.
I'm going to stop here for now. This is a complex subject, so I'll revisit this from time, and edit as needed, or when something else occurs to me. Please feel free to ask if you have any questions about any of it. I'll be glad to help.
