but I think the S1 capabilities are more limited?
That depends on your point of view, and what you want the radios to do.
If only S1 provides point-to-point communication, why can CE = 1 be made between settings?
Out of context, I do not know what CE is supposed to do, so I can't answer that question.
What is the coordinator feature if you can send it by specifying 2 endpoints of 16x address?
Lots of lovely words, all spelled correctly, but, collectively they mean nothing.
There are two ways to get any two XBees to communicate (any two of the same Series, that is). One is to use AT mode, where you configure one XBee to specifically communicate with another one, and send text between them. The other is to use API mode, and assemble packets. The packet contains the address of the sender and the address of the destination. In this mode, the Arduino can assemble two (or more) packets, each containing a different destination address, and have the XBee send them. Two, or more, different end devices can then get messages from one coordinator, and know who to reply to.
Using the XBee library is the easiest way to use API mode, constructing and deciphering the packets correctly.