whats the difference between sanity and insanity, as portrayed in the novel?

We'll have to look at Darl first. He is the only truly insane character from the novel. He was already mad at the introduction, and the things that happened to the family (mother's death, storm, traveling, ect.) only served to unhinge him. For Darl, the complete entrance in madness came with the burning of his mother's body.

The rest of the characters all have the capability of joining him. Maybe Faulkner's intent was to shadow that fine line between the two states in order that the reader might see how very close together they really are; maybe he just wanted us to understand that there's a bit of madness in everyone.

Jewel resisted and conquered madness because he was the toughest of the group. Vardaman, as young as he is uses actions that some might perceive as mad to understand death........... but he's not mad; he's just innocent and there's no one else to help him. This very dysfunctional can't help itself in the least.