I think this page compares it well: https://learn.microsoft.com/en-us/azure/service-fabric/service-fabric-cloud-services-migration-differences/
I can't tell it better than this.
There is not really a rule of thumb. Service Fabric might seem more complex but offers some things that Cloud Services / Web Apps don't.
A quick summary (taken from the link provided):
Service Fabric itself is an application platform layer that runs on Windows or Linux, whereas Cloud Services is a system for deploying Azure-managed VMs with workloads attached. The Service Fabric application model has a number of advantages:
- Fast deployment times. Creating VM instances can be time consuming. In Service Fabric, VMs are only deployed once to form a cluster that hosts the Service Fabric application platform. From that point on, application packages can be deployed to the cluster very quickly.
- High-density hosting. In Cloud Services, a Worker Role VM hosts one workload. In Service Fabric, applications are separate from the VMs that run them, meaning you can deploy a large number of applications to a small number of VMs, which can lower overall cost for larger deployments.
- The Service Fabric platform can run anywhere that has Windows Server or Linux machines, whether it's Azure or on-premises. The platform provides an abstraction layer over the underlying infrastructure so your application can run on different environments.
- Distributed application management. Service Fabric is a platform that not only hosts distributed applications, but also helps manage their lifecycle independently of the hosting VM or machine lifecycle.