Differences between prerendered and real-time animation.

Heh, here is a question that should be way below me, but the truth is, I just can't really sit down and research it. I can see the difference between prerendered and real-time if you showed them both to me, but I just don't get the logic of why real-time rendering is so superior. I know there are plenty of people, like Bubba, that could give a detailed explanation on this. So, who's willing to give me an idea of how prerendering and real-time rendering works and why one is better than the other?

Real-time rendering is superior because the user is able to interact with it?

Ah, I'm speaking more specifically to things like cut-scenes. You'll hear how some cutscenes are rendered real-time and some are prerendered.

Smaller file? The only other reason it could be superior is because it was probably done with some easy to use engine any end-user could use. As far as quality, prerendered is, with current technology, always better.