On the xHighlight  ​​​​glTF Export dialog, there are two formats on the drop-down menu: glb and glTF. Which should I use then? 

To cut to the chase, for final deliveries, glb is recommended, which packages data as a binary file. It is a more compact.

If you would like to debug, the second choice works better with separate pieces to analyze insights respectively: glTF, bin and textures. 

By the way, glb and glTF focus on run-time efficiency, so they are NOT authoring formats and work differently than typical 3D ‘authoring’ formats, such as sldprt (SOLIDWORKS Parts) and sldasm (SOLIDWORKS Assemblies). Authoring formats are typically more verbose, with higher processing overheads, to carry authoring data that is no longer needed after iterative design is complete.

But you can definitely reference glb and glTF in your design, similar to reference a jpg image. 

More details can be found in the specifications of glTF.