An encrypted password is like anything else which has been encrypted: it has been rendered unreadable through a process which used an extra piece of secret data (the key) and which can be reversed with knowledge of the same key (or of a distinct, mathematically related key, in the case of asymmetric encryption).
For password hashing, on the other hand, there is no key. The hashing process is like a meat grinder: there is no key, everybody can operate it, but there is no way to get your cow back in full moo-ing state. Whereas encryption would be akin to locking the cow in a stable.
