I'm not sure how you've been led to this confusing state but I will try to help.
There's Decora, which is a (now dead) fashion. It was something where you use a LOT of accessories, a LOT of layering, and stick to only a few major colors in the outfit. Usually colors range from pastel to really bright, mostly pink, but can be black on occasion. There is no particular silhouette in Decora, it's just whatever you can find. It is possible that the style evolved into Fairy-kei which is ALL pastels, and a bit more toned down from Decora.
Examples:

Fairy-kei looks like this. You can probably see the influences and overlaps between the styles. Fairy-kei uses a LOT of nostalgic little kid visuals, like graphic tshirts with CareBears, My Little Ponies, Popples, etc. It's possible to use a lot of colors, as long as they're all pastel. Most times, skirts are shorter than what would be appropriate in Lolita, but sometimes you see someone doing a fairy-kei outfit with a Lolita skirt. AP is even putting shorter skirts out that are used in both styles.

Then you have girls that mix their brand into a Fairy-kei esqe outfit.

And then, at the very end of the spectrum is Deco Lolita. It's Lolita inherently, with a lot of accessories and more layering than usual.

This post has more examples of the differences:
http://community.livejournal.com/egl/15053156.html